The slump in the value of City of London offices has been so severe that it is now the only real estate hub in the world that offers a good deal for international investors.
The slump in the value of City of London offices has been so severe that it is now the only real estate hub in the world that offers a good deal for international investors.
No other office market has seen as swift an adjustment in price that would make sense for investors, according to the annual Money into Property report from consultancy DTZ, which covers 38 countries across Europe, Asia-Pacific and the Americas.
The report says that the outlook for global property investment remains bleak, with no respite imminent from falling values. For the UK, the period between 2008 and 2010 is forecast to see the worst cumulative returns for property since records began in 1921.
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In the UK, prime rents in the City and West End of London have fallen by 31 per cent and 23 per cent since the peak in 2007. DTZ expects further falls of 14 per cent in the City and 20 per cent in the West End over the next two years. But even if rents fall further, the prime City of London office market still offers attractive returns.
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