BNP Paribas Real Estate carried out the study to better understand how companies in the technology, media, and telecoms (TMT) sector view their prospects and the London office space market. The headline findings were that 54 per cent of TMT businesses with offices in London plan to boost their staff levels over the next three years and that the average anticipated increase is as high as one-third.
There has been growing interest paid to the views of the TMT sector in recent years as more traditional sources of office space demand have been notably squeezed since the 2008 financial crisis. BNP Paribas Real Estate’s report notes that the range of companies categorised as TMT operators is broad but also makes evident that there is a real sense of vibrancy in the industry and a likely demand for a lot of quality office space in various locations.
Indeed, the report suggests that the TMT sector in London will need to add the equivalent of two Shard office buildings worth of office space to the stock it uses before the end of 2014. London was rated second behind New York in the list of the world’s leading centres for media and technology industries. No particular area of London emerged as the leading location for TMT companies keen to expand their offices. Still, there was an apparent demand for high-quality and modern offices across the capital.
“When participants were asked to use three words to describe what their ideal property would look and feel like, ‘modern’ was the undisputable winner,” the BNP Paribas’ report said of its research findings.
The report also found that while London and New York were viewed favourably as operating destinations of choice for TMT companies, San Francisco and Silicon Valley in California fared much less well in the study despite being where the likes of Facebook, Microsoft, and Twitter instigated so much growth and innovation in the sector.
Editor’s notes: In 2023, the TMT sector accounted for 15 per cent of London’s total office space use.