In November construction activity in London fell to its lowest in 20 years highlighting the impact of the recession and the general down turn in the private sector. Only 22 schemes are currently under way which is 68% less than what is was a year ago.
This sharp drop in activity is an inevitable consequence of the recession as many projects have been scrapped due to lack of finance and demand from businesses to rent space practically disappeared. This slow down is of particular note as no new developments have been commissioned this year, the first time this has happened in the 20 year Crane Survey. 2011 and 2012 will mark the lowest years for completions on record and the bottom of the current cycle.
However, the largest developers are starting work again on major skyscraper projects in the City, such as the Walkie Talkie and Cheesegrater, as they forecast an improvement in business demand and a pick-up in rents. As ever, we attempt to find the silver lining. 2011 does mark an increase in potential projects but there are fears that the market could see an over-supply of business space by 2014.
