A £16bn tide of overseas money flooded into the London commercial property market last year, fuelling the best year for the capital since the height of the boom in 2007, according to estate agents Jones Lang LaSalle (JLL).
The end of last year saw a host of major deals including the sale of trophy London assets including More London – sold to Kuwaiti buyer St Martins Property Group for £1.7bn – and the St Botolphs building in the City, which was sold to a German fund for £460m. The former Canadian diplomatic base at One Grosvenor Square was also sold to an Indian developer for £306m.
JLL said £16.2bn was pumped into London property last year, mostly from overseas buyers. Damian Corbett, head of central London office investment, said: “The final quarter has been very strong, and turnover has exceeded initial expectations after a subdued start to the year. In fact, London remains the most active global city, with deal volumes around 1½ times its nearest competitor New York, followed by Tokyo and Paris.
“We have seen continued interest from foreign buyers, particularly those from the Asia/Pacific region, and are also seeing new entrants to the market from all around the world.”
Office lettings meanwhile jumped to 10.8 million sq ft for the year, well ahead of 2012’s total of 7.2m. In the City, lettings hit at least 6.8m sq ft, levels not seen since 2006 and potentially the largest since the record year in 2000.