City is changing, and not just because of the skyscrapers about to reinvent its skyline. The firms that are taking office space are changing as well.
The trend for insurers to cluster in EC3 around the Lloyd’s building is well-established. Equally striking has been the lack of demand in Cannon Place and the Walbrook, in an area associated with financial services.
The announcement of tenants at the Walbrook is a relief, but it is too soon to announce recovery. The appearance of Cannon Place as a fictional office location in the latest series of TV crime drama Silent Witness is a quiet reminder of the lack of real occupants.
Meanwhile, not content with the fast-growing digital development hub around the Old Street roundabout, technology firms are finding the City itself an attractive choice, according to research from Colliers International. And in the West End, even hedge funds must be feeling the pinch as rents rocket to the highest in the entire world.
Such trends are the inevitable result of the post-crisis adjustment in the City, and the changing face of global demand. It has been a harsh process for the commercial property sector, but even the stalled development of the Helter Skelter tower that had cast a metaphorical shadow over the City in recent years seems to be moving again in 2013.
And empty offices are about vision as well as failure. The Empire State Building was empty at first, having opened at the height of the Great Depression. It eventually became both profitable and an icon of its city. The City is likely to opt out from the new decision to allow commercial office space to be converted into housing, but it will do so as an expression of faith that office demand will return – for the firms who can ride out the slump.