Marijana No Comments

Commercial rent disputes drop to five-year low in Scotland

The number of commercial rent disputes reaching a third party in Scotland fell to its lowest level for more than five years, according to analysis from Knight Frank.

Figures obtained by the independent commercial property consultancy from the Royal Institution of Chartered Surveyors (RICS) showed that the number of cases being referred to third-party dispute resolution dropped from 169 in 2017 to 123 in 2018 – down just over a quarter, 27.2 per cent.

This is less than half, 42.1 per cent, of the 292 cases that went to independent assessment in 2016. It is also below the figures for 2015 (155), 2014 (125), and 2013 (147).

Independent experts or arbitrators are appointed to cases where commercial tenants and landlords cannot agree on a new rental agreement at a fixed-term rent review date. Typically, these are conducted every five years, depending on the terms of an occupier’s lease.

Most reviews state that the rent can only increase – not decrease. This is distinct from lease renewals, where the parties can agree whatever rent deemed appropriate, subject to prevalent market forces, local supply-demand dynamics, along with other factors.

Andrew Hill, partner at Knight Frank, said: “In the aftermath of 2008, most businesses became used to their rents reducing or staying the same. However, in 2016 we saw a spike in the number of third-party applications, as the market showed continued improvement and landlords in turn became more bullish in their aspirations on rental growth. This was disputed by tenants who had become accustomed to rent stagnation.

“Since then, the occupier market in Scotland’s central belt has become even tighter for both offices and industrial premises. Despite a challenging macro-economic environment, sentiment has continued to improve and there are real constraints on availability. As a result, it looks like we have hit another tipping point: generally, businesses appear more minded to accept rent increases provided there is compelling comparable evidence, as quality space remains at a premium.”

The numbers come against the backdrop of a tightening supply of available office and industrial commercial property space.

In Edinburgh, office lettings completed between January and March 2019 saw Grade A availability fall to only 235,000 sq. ft. – the equivalent of just one year’s Grade A take-up. Knight Frank predicted that, combined with other factors, this will drive prime office rents to £36 per sq. ft. by the end of 2019.

Despite a below-average first quarter for take-up in Glasgow, new Grade A availability – excluding refurbished properties – fell to 33,353 sq. ft. Headline prime office rates currently sit at £32.50 per sq. ft. in the city centre for new accommodation and £30 per sq. ft. at refurbished premises.

Mr Hill added: “Another factor at play is the risk and cost associated with pursuing a third-party award or determination. Arbitrators can attribute near all the third-party cost to the unsuccessful party, which can be a real sting in the tail for an organisation challenging and then losing a case against a rent increase. That can be a real deterrent at a time when much of the comparable evidence supports rent increases in prime locations.

“Of course, it’s not the case across the board. Retailers located beyond the main thoroughfares, in particular, are mostly seeing rents stagnate or even go into reverse. Prime offices and industrial, however, are still subject to a real lack of available space which, all things being equal, should put upwards pressure on rents for the foreseeable future.”

Across the UK, RICS said it had seen an average 6 per cent rise in commercial rent review applications from 2013-2017, while there was a 12 per cent decline over the last 12 months.

spokesperson for RICS commented: “The commercial rent review market moves with how the economy behaves – the last 12 months have been challenging for the sector.

“There is a significant change in retail habits with increased demand for online purchases, large retailers falling into administration, underperforming retailers being bought out – some at low-cost – and retailers merging operations. Overall, there is a desire for shorter leases and the commercial market has seen parties move towards lease renewals.”

By Andrew Hill

Source: Scottish Legal

Marijana No Comments

Prime UK commercial property rents increase 0.1% in Q1 2019

UK prime commercial property rental values increased 0.1% in Q1 2019, according to CBRE’s latest Prime Rent and Yield Monitor. At the All Property level, prime yields moved out 6bps over the quarter. Overall results in both prime rents and yields were driven by the continued outperformance of the Industrial sector.

Q1 2019 marked the ninth consecutive quarter of Industrial outperformance, with prime rental values increasing 1.0%. This is the sector’s lowest quarterly growth in prime rents since Q4 2015 as the stellar increase of 8.3% p.a. over the previous three years slows to more trend levels. Industrials in the North West reported the biggest increase in prime rents over the quarter (4.3%). Industrial prime yields were stable overall in Q1 2019. At the regional level, Scotland reported a -15bps decrease in prime yields while the Yorkshire & Humberside and North East markets reported increases of 29bps and 25bps respectively.

At the national level, High Street Shop prime rents fell -1.0% in the first quarter of 2019. This was an acceleration of the falls reported in Q3 (-0.4%) and Q4 (-0.4%) of 2018. Shopping Centre prime rents fell ‑1.3% over the quarter, while Retail Warehouse prime rents decreased -1.0%. Overall, High Street Shop prime yields rose 12bps in Q1. Prime Shopping Centre yields increased 12bps over the quarter. Retail Warehouse prime yields rose 25bps.

Office prime rents increased 0.6% overall in Q1 2019. Sector results were pulled up by the Central London (1.0%), Eastern (1.1%), Yorkshire & Humberside (1.2%), and North West (2.1%) markets. No UK region reported a decrease in prime Office rents in Q1. Prime yields for the Office sector were relatively stable overall in Q1 (+1bp).

Robin Honeyman, Senior Research Analyst at CBRE UK, said: “Falls in the Retail sector pulled down the All Property results in Q1 2019, despite the relative strength of Office and Industrial performance. Our Prime Rent & Yield data continues to show prime Retail coming under pressure, both in pricing and rental values.”

By David Tran

Source: SHD Logistics

Marijana No Comments

UK Commercial Property Set for Rebound

There’s a lot of cash on the sidelines waiting to snap up UK property assets once certainty on Brexit is known, according to real estate investment trust managers. However, they warn the market could see some short-term pain in the meantime.

Equity investors have been vocal in putting forward their expectation of cash flowing into the UK stock market once Brexit is resolved, no matter what deal we get. While it’s unlikely to be as dramatic in property, the asset class remains more resilient than many expected.

There’s money waiting to buy UK real estate, predicts Calum Bruce, manager of the Ediston Property Investment Company (EPIC), from both domestic and overseas buyers. “Once there’s some clarity, there will be a period where people will just digest what’s happen, formulate a strategy and then look to implement that strategy,” he tells Morningstar.co.uk.

Simon Marriott, investment director at London & Scottish Investments, agrees, though has sympathy with those continuing to hold off committing just yet. “I’m a believer when there is some certainty, anything other than no-deal, prices are going to get stronger,” he says.

Bruce explains that there is plenty to like about UK property, particularly for overseas investors looking for a safe haven in an uncertain world. “The UK ticks a lot of boxes for these investors,” he adds. These include a stable economy, favourable political climate for the asset class and yields higher than many other cities both in Europe and elsewhere.

“But why would they invest now if they think there’s going to be a slip in value and their euro or dollar will go further in a few months’ time? That’s why we need some clarity so these investors can go ‘right, now’s the time to come in and invest’.”

However, it seems likely it will be some time until that Brexit fog clears. While Prime Minister Theresa May’s extension to the Brexit deadline is flexible, odds are it will, again, go right down to the wire on October 31.

Therefore, this predicted pick-up in activity is likely to be a 2020 phenomena. Indeed, Nick Montgomery, manager of the Schroder Real Estate Investment Trust (SREI), thinks we’ll see a correction before any recovery comes about.

“Are we at the top of the cycle? If you look at the average for the market, we think values will fall,” he explains. “We’re not expecting a return to 2009 where values fell by multiples of 10%, but we are expecting a correction.”

As a result, he’s been selling some of his lower-yielding assets, including most of his retail portfolio, in order to build some cash and give him firepower once that correction comes.

Despite being late-cycle, Montgomery says there are plenty of opportunities around with “immense polarisation” between sectors. Below, we highlight three areas REIT managers are seeing, or expect to see, opportunities in the UK property market.

Regional Offices
Being the big hub, particularly for financial services firms, and capital, London will garner many headlines when it comes to the outlook for UK offices. However, many are now seeing opportunities some of the other larger cities in the UK.

Both businesses and the Government are beginning to spread their workforces around the country. The BBC has recently set up camp in Salford, while accountancy firm PwC has a new 80,000 square foot office in Leeds.

“These cities are not back-office locations anymore,” says Marriott. “These are all high-quality locations in their own right, with highly qualified workers who have made life changes [to] move out to the provinces because it’s closer to where they were brought up or their quality of life is better [than in London].”

With the UK one of the world leaders in artificial intelligence, companies are looking for more office space around university cities, too, like Oxford, Cambridge, Bristol and Durham.

Montgomery says Schroders is one of the biggest owners of commercial real estate in Manchester, having identified it as one of the “winning cities” in the UK moving forward.

“[Manchester has] great public sector leadership and a disproportionate share of public sector investment, which has drawn people into the city centre, with the population doubling over the course of the last 10 years or so,” he explains.

Retail Warehousing
Unsurprisingly, many are downbeat on the future for retail. Structural headwinds, including the increasing move to online shopping, have meant a lot of retail firms have either gone bust or are on shaky ground.

Those that have survived are now looking to downsize their store estate or reduce the rents they pay as shoppers increasingly eschew a trip to the high street or their local shopping centre.

However, there are still opportunities in retail. Bruce is the most bullish, arguing that the doom and gloom headlines don’t tell the whole story. “Retail is evolving; I don’t think it’s in terminal decline,” he says.

True, he cautions, retailers that have failed to adapt, evolve or change to the new environment will fall by the wayside, but others have done so and are well set to take advantage. Indeed, Bruce likes out-of-town retail parks in places like Hull, Barnsley or Sunderland, which lend themselves most to the click-and-collect model..

As ever, it’s all about good stock selection, of course: “not all retail warehousing is equal”. While the likes of Next and others are known to be looking at decreasing the rent they pay, they are also happy to increase their costs for units in good, profitable locations.

“We have a retail park in Prestatyn and have completed four rent reviews with River Island, Next, Card Factory and Costa and have got an increase on all of them because it’s a good park in a good location,” says Bruce.

The London & Scottish Investments team, which runs the Regional REIT (RGL), have only a small portion of their portfolio allocated to retail and that is overhang from portfolios they have bought.

Despite taking the decision not to consciously invest in retail when they launched their product back in 2013, they also have no plans to sell their two properties, which comprise a shopping centre in Bletchley and retail park in Swansea, any time soon.

“These are yielding well north of 8% so there’s no reason for us to sell them,” says managing director Derek McDonald. “We’ve got one very small void at Bletchley and none at Swansea and we’ve not had any CVAs, so why rush to sell them when they’re not hurting you?”

Central London Offices
Clearly, this one’s most at the mercy of the outcome of Brexit negotiations – and the UK leaving without a deal would not be positive for the asset.

But Bruce says the office market in the capital has been more resilient than expected. “There are people hedging their bets, but I don’t think it’s been as dramatic an exodus as people expected.”

True, the market has hitherto been too expensive for Bruce to justify getting stuck into, and pricing is still not there just yet. However, he’s encouraged that “more things are coming across our desk which we’re interested in doing something with”.

“Rents are probably under pressure more than they are in other parts of the country, but in the main there’s been pretty good take-up and supply is at a reasonable level.”

Marijana No Comments

Non-EU investment in London commercial property rose 75 per cent in 2018

Purchases of London commercial property by non-EU investors soared last year, rising 75 per cent on 2017.

But investment from within the EU dropped sharply, according to figures from real estate research company Datscha.

Non-EU investors racked up £8bn in purchases in 2018. That was almost 10 times the amount spent by their European counterparts, who spent £885m, representing a 68 per cent fall on 2017.

Asian and US investors were the biggest spenders. South Korean investors led the way, forking out a total of £2.4bn.

Investors from China and Hong Kong made over £2.3bn in purchases, a fall of more than two-fifths on the previous year. Their reduced spend is likely due to Chinese government restrictions on overseas investment.

Wework and Colony North Star’s share in the £580m purchase of Devonshire Square helped North American investment double to more than £1.26 billion.

Other sources of investment included buyers from South Africa, Israel and Saudi Arabia. Office space accounted for 95 per cent of overseas commercial investment.

The market for commercial property in the City was “influenced by the UK’s political uncertainty and weakening of sterling”, said Lesley Males, Head of Research at Datscha.

“This has still brought positive interest in the City of London from a number of overseas buyers wanting a stakehold in what we believe is an ever-appealing investment zone,” she added.

By Michael O’Dwyer

Source: City AM

Marijana No Comments

Wealthy overseas investors snap up Scottish property

Scottish commercial property attracted more investment last year from wealthy overseas investors than France, Japan and South Korea, according to new research.

Releasing its latest Wealth Report, property consultancy Knight Frank said its analysis had found that total investment from “internationally-based ultra-high-net-worth individuals” in Scottish commercial property totalled some $376.3 million (£283.6m) in 2018.

The figure for France was about $360m, Japan came in at $110m, while South Korea was just $10m. Scotland was placed eighth globally for cross-border private capital investment in commercial property, such as offices, shops and industrial sites, behind Canada at $770m.

The UK as a whole, including Scotland, topped the overall rankings at just over $8 billion, followed by the US at $7.4bn. Knight Frank said that total private investment in Scottish commercial property, which includes UK buyers, was £760.4m last year, a 26.3 per cent increase on 2017.

Private investors represented about 30 per cent of the more than £2.5bn that was invested in commercial property in Scotland during a “resilient” 2018, the firm noted.

Recent high-profile deals involving private investors have included Jenners’ historic department store on Edinburgh’s Princes Street, which was bought by a Danish investor for £53m, while the property company of Inditex fashion group founder, Amancio Ortega, acquired 78-90 Buchanan Street in Glasgow for £31m last year.

Alasdair Steele, head of Scotland commercial at Knight Frank, said: “Commercial property in Scotland offers solid returns for investors – particularly individuals, who can expect to see the value of their capital eroded by inflation if they keep it in the bank.

“There is a strong appetite for investment outside of London and Scotland is perceived as being relatively good value, even within the UK.

“Both Glasgow and Edinburgh offer compelling supply-demand dynamics and attractive yields. All things being equal, we expect that to drive rental growth over the next couple of years and, therefore, the potential returns to landlords.”

William Mathews, head of capital markets research at Knight Frank, added: “We expect that the appetite from private investors for commercial property will continue to increase as the number of wealthy individuals grows.

“Our latest Wealth Report shows that 21 per cent of ultra-high-net-worth individuals plan to invest in commercial real estate in 2019.”

By Scott Reid

Source: Scotsman

Marijana No Comments

Sharp rise in property values for UK’s top shared office space providers

The value of property owned by the UK’s biggest shared office providers soared by more than a third last year.

In a sign of the growing flexible workspace market, the value of the industry’s top ten share office providers’ property jumped 35 per cent to £13.6bn last year.

The new data, released by real estate law firm Boodle Hatfield, also underlined the growth in demand for shorter leases among major companies, with the 2017 average length for a new commercial property lease standing at 7.1 years on average, compared to an average of 25 years in 1987.

Rising appetite for such short leases and shared office spaces has driven an increase in traditional property heavyweights experimenting in the sector, with giants such as British Land, Great Portland Estates and Landsec all looking to tap into the fast-growing market.

“Shared workspaces have now gone beyond being a cool place for media and tech startups – they are now a substantial part of the commercial property market in major cities worldwide,” according to Simon Williams, partner at Boodle Hatfield.

Williams added: “The success of WeWork has tempted some of the bigger traditional players in commercial property into the shared workspace market. The expectation is that there is still significant growth in this market in the coming years.”

Source: City AM

Marijana No Comments

London remains top gateway city in the world for commercial property investors

London maintained its position as the top city for global real estate investment in 2018, according to research published today by JLL. The report claims that investors continue to favour cities they are familiar with and that have well-established investment markets and high levels of transparency. Well-known, large gateway cities with the world’s deepest concentrations of capital, companies and talent continue to dominate the top ranks. Twelve cities–London, New York, Paris, Seoul, Hong Kong, Tokyo, Shanghai, Washington DC, Sydney, Singapore, Toronto and Munich–have appeared in the top 30 ranking every year for the past decade and account for 30 percent of all real estate investment.

The data shows that total volumes in 2018 were $733 billion, up 4 percent from 2017, the best annual performance in a decade. Cross-border purchases accounted for 31 percent of activity in 2018, close to the 10-year average, suggesting investors still have appetite to buy outside their own markets.

Expectations for 2019

JLL projects that investment activity momentum will be maintained into 2019, as real estate continues to look attractive in comparison to other asset classes. Fundamentals in real estate remain compelling, despite historic low yields, as robust corporate occupier fundamentals across most markets are leading to positive returns. As such, investment activity may slow, but only marginally from its current high, as investors look to hold their real estate exposure and become more selective in the search for assets with strong income growth.

  • The institutional real estate universe will continue to expand, driven by factors such as low volatility, diversification benefits, long-term income and an attractive pricing premium to core sectors. Asset classes such as student housing, senior living and multi-family have continued to attract more institutional money in 2018 and this is likely to continue in 2019.
  • Industrial now accounts for 17 percent of all investment, up from 10 percent in 2009. In contrast, the retail sector has seen less activity as investors adjust their investment approach to reflect changing consumer behavior. In gateway cities, the office sector tends to account for a higher proportion of investment volumes—68 percent in 2018, compared to 51 percent in global volumes.
  • The top 30 will continue to be dominated by the gateway cities in 2019. However, at the edges, investors will consider a widening range of cities in their strategies. Reflecting real estate investors’ risk appetite, secondary cities in established transparent markets, such as Osaka and Atlanta, are likely to attract more attention, as opposed to moving into entirely new countries.

Yields are now at historic lows in most markets across the globe. A sharp correction is unlikely, as there is still a significant weight of capital looking to invest in real estate, and corporate occupier market fundamentals across many markets are positive. This creates the potential for continued income growth. However, in 2019, overall investment volumes are expected to fall approximately 5 to 10 percent below the 2018 total, driven by a slightly reduced appetite from investors to sell, as well as continued selectivity in acquisitions.

Source: Workplace Insight

Marijana No Comments

Outlook 2019: Commercial property sector preparing for a supply shortage

After a solid 2018 in the commercial property sector, the north has to prepare itself for a supply shortage in 2019, according to Craig Burrow, Leeds Director at Bruntwood.

Speaking at TheBusinessDesk.com’s Outlook 2019 seminar, Burrow said: “From a commercial property perspective it’s been a very good year generally. Leeds particularly is having another strong year in terms of the office market take-up. We’ve also had a great year with the completion of the Platform building in the city centre.

“We’ve seen rents rising, occupancy rising, and investment transactions have hit record highs in Northern Powerhouse cities.”

However, Burrow did say that “one of the biggest challenges” for Bruntwood going into 2019 was the “supply shortage” in the north.

As for the challenges facing Liverpool, Philip Rooney, managing partner at the Liverpool office of DLA, said: “What we don’t have here is top quality office space, and we definitely need more of it. If we have that, then Liverpool will become a far better competitor to other cities.

“This is a fantastic place to live and work, it is absolutely the place to be now, so we need to make sure companies are attracted to come here.”

Despite this, Adam Higgins, co-founder of Capital & Centric, said he believed that the success of neighbouring city Manchester would eventually begin to benefit Liverpool from an office take-up point of view.

He said said: “What Manchester has done in the last couple of years really well is attract office occupiers coming up from London, but the city is now getting to the stage where office space is going to become more and more expensive.

“Companies moving into new builds in Manchester will be paying around £36 – £37 a sq ft, whereas Liverpool is down in the mid twenties. Some businesses just won’t want to pay those rates in Manchester which means they will start to look at Liverpool.”

Tom Kelsall, partner at the Manchester office of DLA Piper, commented on the importance of keeping Manchester’s developments connected and act as part of a community almost.

Kelsall said: “The combined authority have an important job over the next several years to pull together different parts of the area’s communities and make sure Manchester continues to grow. What we don’t want is single assets out in the middle of nowhere that don’t feel connected to the rest of the city.”

Speaking of the office occupier market, Vivienne Clements, director at Henry Boot Developments, said: “We have seen a lot of success this year within the employment scheme Markham Vale. This year we have seen major decisions being made to commit to Sheffield.”

Following the success of Henry Boots Developments this past year, Clements also said they have now “gained an insight across the board” in relations to companies that take up space in studio business park developments.

She explained: “The confidence that Sheffield can take forward is that good quality mid-range companies, who can afford to buy their own building, are attracted to the area. Out of the 16 companies that we’ve brought to Markham Vale, five of those have already expanded further onto the site and one of those expanding is doubling its size just in a five year period.

“We can take confidence in that we have a really strong base and we need to nurture that base because when it comes to a recession they are the backbone that we call all resort back to.”

David Wilton, Chief Financial Officer at Sumo Digital, also spoke about the city’s growing technology sector, and the importance of using this momentum to attract other global tech companies to take office space in Sheffield.

He explained: “It it fantastic that Sheffield is becoming a tech centre of excellence. The foresight that drove the movement away from traditional, old fashioned engineering businesses to a more tech end digital city was great.

“We now need to invest more in tech, and that is about training the right people and attracting the right people to this area.”

Source: The Business Desk

Marijana No Comments

Commercial property market ‘showing plenty of resilience’ in Yorkshire

Despite the wider UK economic uncertainties and of course the unknowns of Brexit, the commercial property market in Yorkshire is holding up well and showing plenty of the resilience the region is famed for.

The industrial market in particular is very active, with increasing numbers of businesses looking to expand outside city areas into the many industrial parks that have sprung up in recent years. In the latest RICS commercial property market surveycovering Q3 of this year, surveyors were positive about Yorkshire with one observing that there are “no signs of pre-Brexit jitters”, adding however that “we need more stock to enable occupiers to fulfil their expansion plans”. The demand for good commercial space is high.

Turning to the focal point of the regional economy, Leeds, the city is home to many major development schemes. A report from Leeds city council published in 2017 highlighted that there had been £3.9bn of development schemes completed in the city over the previous ten years – with a further £7bn in the pipeline. You only need to look at the number of cranes against the skyline to see that this activity is still forging ahead.

The blot on the landscape, however, is retail. The national malaise affecting the High Street applies in Yorkshire as much as anywhere else. Many city centre shopping centres are struggling to attract business. Some areas with a relatively wealthy demographic, such as Harrogate, may be continuing to attract footfall, but other cities in the region are undoubtedly finding the going tougher. Retail property values are struggling to hold up and funds have begun to exit the sector in favour of office and industrial.

The Chancellor’s Budget recently included measures to help the High Street, with £900m in business rates relief for small businesses, a £675m ‘future high streets fund’ for the transformation of high streets and potential changes to planning rules to allow shops to be converted in homes and offices. How far these measures will go, in Yorkshire and nationally, to support the retail sector and stimulate demand for space only time will tell.

One of the great factors supporting the resilience of the Yorkshire market is the attractiveness of the region as a place to live and work. The population of Leeds, for example, is projected to grow from 779,000 in 2016 to 826,000 in 2026 – an increase of 6%. The popularity of the region as a place to live means that it will also remain a good place to do business, underpinning both the residential and commercial markets. This will be further bolstered when HS2 eventually comes on line, increasing and improving connectivity.

The recent decision of Channel 4 to make Leeds its new national headquarters was further proof of the attractiveness of our region and a great shot in the arm for the city. It will have a ripple effect across the local economy.

Lenders remain active in the market, willing to lend against good residential and commercial developments.

With a growing population, improving infrastructure and funding available, the region’s property market looks set to continue to offer attractive opportunities for both developers and occupiers.

Source: The Business Desk

Marijana No Comments

Brexit and the City – A barometer for London’s financial outlook

London’s skyline is changing fast, pierced by gleaming new skyscrapers which defy predictions of a Brexit-related slowdown in the capital’s two financial districts.

With only six months until Britain is due to leave the European Union, the terms of its separation have yet to be decided, leaving critical questions over the long-term future of London as the bloc’s pre-eminent financial centre.

Some politicians and economists expect the split will damage the City, as the capital’s traditional financial services centre is widely known, while Brexit supporters say it will benefit from being able to set its own rules.

Reuters is publishing its third Brexit tracker, monitoring six indicators to help assess the City’s fortunes, taking a regular check on its pulse through public transport usage, bar and restaurant openings, commercial property prices and jobs.

The latest Reuters assessment shows a slowdown in some areas, while others are thriving despite the uncertainty.

“It is certainly an awful lot better than we expected 12 months ago and dramatically better than we expected 24 months ago,” Mat Oakley, head of European commercial research at real estate agents Savills, said.

Although property prices and hiring rates have slowed, the number of bars and restaurants open in the centuries-old financial district are at a record level and financiers still queue at the security scanners at nearby City Airport.

Britain is due to leave the EU on March 29 next year, but there is so far no full exit agreement and Prime Minister Theresa May’s plans for future trade ties have been rebuffed by both the EU and many lawmakers in her own party.

Many business leaders fear that a political crisis could propel Britain into a chaotic and economically damaging split, spooking financial markets and dislocating trade flows.

The latest Reuters jobs review shows just about one-in-ten of the about 5,800 jobs flagged as being at risk of moving out of London or being created in another EU city by the end of March have actually moved, although many firms have taken steps to change their legal structure to enable a swift change if needed.

Jobs leaving London

As few as 630 finance jobs have so far been shifted or created overseas due to Brexit, a far lower number than first predicted, suggesting London will retain its position as one of the world’s top two financial centres, firms employing the bulk of UK-based workers in international finance told Reuters.

The results from a Reuters survey of 134 firms, following up on two previous surveys, show that although companies have made detailed contingency plans they are delaying moving large staff moves until after the outcome of negotiations with the EU on the future trading relationship.

Hiring numbers

The number of available jobs in London’s financial services industry fell the most in six years in 2018, said recruitment agency Morgan McKinley, which hires staff in finance.

It bases its number on the overall volume of mandates it receives to find jobs and applies a multiplier based on its market share of London’s finance industry.

Commercial property

Reuters obtained property data from Savills and Knight Frank, two of the biggest real estate firms in Britain. Savills calculates the value from all-known property deals within the City of London area.

The price of renting real estate in the City of London district fell 6 percent in the first six months of the year, falling to 75 pounds per square foot, from 78 pounds in the third quarter of 2016, Savills says. The rental prices are 1 percent higher than in June 2016 when Britain voted for Brexit.

“The story seems to be that big corporates are planning through any period of potential uncertainty. They are taking a five or more year view because some of these deals that we count as happening today or happening in the first half of the year the tenants are not moving in until say 2022,” Mat Oakley, head of European commercial research at Savills, said.

“I wouldn’t say prices are booming….but they are certainly holding steady.”

In Canary Wharf, prices are little changed since last year, Knight Frank, whose data comes from landlords, developers and agents, say.

Global foreign exchange

Britain has defied sceptics and extended its lead in the global currency trading business in the two years since it voted to leave the European Union.

Reuters analysis shows forex trading volumes in Britain had grown by 23 percent to a record daily average of $2.7 trillion (2.1 trillion pounds) in April compared to April 2016. That was double the pace of its nearest rival, the United States, which was up 11 percent to $994 billion, mostly out of New York.

Going Underground

Some 400,000 journeys are recorded every day at the three main underground stations that serve the City and Canary Wharf.

Reuters filed Freedom of Information Act requests to Transport for London, to get this data, which shows that the number of people using Bank and Monument stations fell in the first six months of the year.

City Airport

The number of passengers using London City Airport, a popular gateway for finance executives, rose to a record high in the first six months of the year.

Bar and restaurant openings

Reuters filed a Freedom of Information Act request to the City of London Corporation to find the number of new premises which have applied for licenses to sell alcohol and license renewals.

The number of venues, such as bars and restaurants, with licenses to sell alcohol in the City of London in 2017 rose 10 percent, data from the municipal local authority shows.

The number of venues applying for new licenses fell slightly compared with 2016, the data shows, although the City of London Corporation said such fluctuations are normal.

Source: UK Reuters