A new report commissioned by the City of London Corporation andundertaken by CB Richard Ellis confirms that London still has acompetitive property offer when compared to other leadingInternational Financial Centres. 'The Competitiveness ofLondon"s Business Property Offer", launches at the MIPIM propertyconference in Cannes and reviews the current and futurecompetitiveness of London"s business property, making comparisonswith other international financial centres. It finds that theCity of London and Canary Wharf are the locations of choice forlarge financial occupiers in the capital; rents are significantlylower than other top office rent locations.

As competition amongst international financial centresincreases, property offers will grow in importance as an aspect ofcompetitiveness. City of London office rents have fallen by 54% inreal terms between the period of 1975 - 2009 which is a much morerapid fall than other major financial centres such as Tokyo, NewYork and Frankfurt.London has a wide spectrum of office space available indifferent parts of the Central London market adding to itscompetitiveness. The top grade A rent in the City of Londonwas £43.50 per sq ft at the end of 2009, whereas the equivalent inMayfair and St James was £85.00 per sq ft. It has a similar profile of availability by rent to Paris " 71% ofavailable units are quoting a rent of less than £40.00 per sq ft inCentral London, compared with 73% in Paris and 86% in NewYork. Current office availability in Central London is nearlyon a par with New York, lower than Hong Kong and Singapore andhigher than Paris, Tokyo and Geneva.However the aspect of London"s property offer which is mostproblematic for occupiers is that supply is inelastic withpronounced volatility in development and rental levels.Although London has good current availability for modern largefloorplates such as a single floor of 20,000 sq ft, the reportsuggests it is less responsive to meeting new demand for largerunits in the future due to strong recent demand.

Stuart Fraser, Chairman of Policy and Resources Committee, Cityof London Corporation said: "London as a truly global city offers a rich tapestry ofarts, culture, entertainment and an open society with a broadethnic diversity. The financial heart, the City of Londontogether with Canary Wharf, offer an unparalleled agglomeration ofskills and disciplines. Add to that a local authoritydedicated to maintaining London"s international competitivenesswith a business friendly approach to planning, unsurprisingly makesit the location of choice for occupiers."The ability to accommodate a super-trading floor is an importantconsideration for major international financial centres. OnlyNew York and Shanghai have current availability for a building withfloorplates of 60,000 sq ft. There were seven buildings inNew York and six buildings in Shanghai, although Shanghai benefitsfrom the exceptional scale of its building boom and would be ableto deliver a further six buildings within two and a halfyears. Paris is the only other centre that could deliver abuilding over a similar timeframe.

Peter Damesick, Head of UK Research, CB Richard Ellis said:"Top rents in the West End often grab headlines, but there ismuch greater depth and diversity elsewhere n London's propertyoffer. However, new supply is prone to long lead times.The credit crunch curtailed development so a supply squeeze in newspace is now in prospect while construction picks up."Over the longer term, London has major potential supply capacitywith a large proportion in new locations. Significanttransport improvements, including Crossrail, will help unlock muchof this supply potential. As a result the market will evolveto a polycentric structure which will enhance London"scompetitiveness in relation to its property offer and provideoccupiers with a greater choice of locations and cost levels.

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