In the wake of the US subprime housing crisis, London offices have deteriorated faster than any other European property market according to a report by Moody’s Investors Service.
Banks in the City and West End have been hard hit by the turmoil in the financial markets with resultant job losses being incurred. Resultantly, office take-up levels are unlikely to reach forecasts.
The report measured the degree of stress on office markets in the short term giving markets scores of between 0 (weak) and 100 (strong) based on market conditions between the middle and end of 2007. Barcelona is another market that has been adversely impacted, slipping from 45 to 30 in the study.
“Despite the financial turmoil, occupier demand remains relatively robust…however occupier demand could be negatively affected if the financial turmoil continues,” said Moody’s associate analyst and co-author of the report, Rod Bowers.