Forecasts of office development in the City of London have almost halved during the past 12 months as developers review plans amid a worsening occupier market and stagnant financing conditions. Financial Times
CB Richard Ellis and Jones Lang Lasalle have downgraded their forecasts for City development significantly to take account of the shift in confidence among developers in London. So far, no developers have said that they will stop their building programmes but agents say that certain schemes are likely to be delayed, with initial ground work already taking longer than expected.
CB Richard Ellis now expects about 6.3m sq ft to be built in the City between 2009 and 2011, a significant reduction from the 13.5m sq ft that it expected to be built during the period this time last year.
Jones Lang LaSalle, meanwhile, predicts that the maximum potential pipeline for 2008-11 fell by 17% last year.
The agent’s development expectation for 2011 has more than halved in the past 12 months because it believes that those not already on site are far less likely to start.