London’s ‘Dysfunctional’ Home Supply to Hurt Tech FirmsPatrick Gower
The growth of London’s technology industry, which has buoyed office landlords as banks cut staff, could be derailed by the city’s housing shortage, a Crown Estate executive said.
“The dysfunctional housing supply in London is one of the biggest risks to its continued success because businesses can’t find accommodation for employees and newcomers,” Paul Clark, director of investment and asset management at the Crown Estate, said on Tuesday at the MIPIM property conference in Cannes. The shortage, along with high rents, is particularly difficult for the technology, media and communications industries, he said.
Technology companies were the largest source of office demand in London in the four years through 2014 as Amazon.com Inc., Google Inc. and Twitter Inc. expanded, Knight Frank LLP said in a Feb. 10 report. A shortage of homes could deter companies from expanding further, according to Clark.
The Crown Estate, which generates income for the U.K. Treasury, has more than half of its properties in London. The city needs 49,000 new homes a year to accommodate its growing population and has the capacity to build 42,000, Mayor Boris Johnson said in an e-mailed statement on Tuesday. About 22,000 homes are built in the capital each year, according to government figures.
About 8.63 million people now live in the capital, eclipsing the previous high set before World War II, the Greater London Authority said on Feb. 2.
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