A survey by estate agents Knight Frank looked at the cost of workspace for staff in major world cities, and found that London was 25% cheaper than New York.
The capital is nonetheless sixth on Frank Knight’s list of the most expensive cities ranked by the cost of office space and employee accommodation. The top five most expensive cities are Zurich, New York, San Francisco, Hong Kong and Boston.
Though London ranks sixth, it is one of the most expensive cities in Europe, ahead of Paris, Dublin, Stockholm, Amsterdam and Frankfurt. One of the reasons why companies do not locate to cheaper European cities is that London has a pool of highly talented people, particularly ones skilled in the tech and financial areas. London has a reputation for business excellence.
The number of companies that have offices on London shows that businesses do not choose their locations by cost alone. London is a global business centre where demand for commercial property remains high.
Lee Elliott, head of commercial research at Knight Frank, is quoted on BQLive.co.uk as saying:
“As it stands, other European cities cannot match London’s high-skilled human capital, and its longstanding pre-eminence as a global business centre.”
The price of commercial property in London is expensive, but property investors can obtain commercial mortgages at reasonable interest rates. With high rents and a high demand for work spaces, good rental yields can be achieved. A good mortgage broker has relationships with many commercial mortgage lenders so that they can find a good mortgage deal for commercial landlords.