MIPIM 2016: Start-ups are disrupting the London office market and part of the industry is “asleep at the wheel”, PwC’s UK real estate leader Craig Hughes said at an Estates Gazette debate.
“Some businesses are looking at flexibility; some people are a little bit asleep at the wheel,” Hughes said at the debate, Start-up London: a safe investment or too tricky to touch?
He added: “If we aren’t going to constantly try to disrupt ourselves; then we are going to be disrupted.”
Fintech appetite is forecast to exceed $100bn and cause huge disruption in the market, according to a PwC report released today.
Jackie Newstead, gobal head of real estate at Hogan Lovells, said flexibility was one of the most important factors for attracting start-ups, which landlords and investors can respond to by creaing hubs or incubator units with further space available for expansion.
She said: “That means shorter leases, break clauses and also clustering into buildings where there are opportunities to grow.”
City of London policy and resources committee chairman Mark Boleat, said financial occupiers are struggling in central London and start-ups, particularly around healthcare and life sciences, represent a “massive growth area”.
Richard Howard, senior director of emerging London at Cushman & Wakefield, agreed that life sciences start-ups were a growing occupier market and that they were likely to continue to look for space in London to draw the best talent.
YourWelcome co-founder Henry Bennett, whose offices are located close to Brick Lane, agreed that occupying good space with other start-ups was key to attracting talent, but also very expensive when paying per desk.
“Graduates like to work in an office with lots of other people, not just the founders,” he said.
“But then when you are paying per desk and it gets to 10 it is very expensive.”
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