In this report, we examine the state of the technology, media and telecommunications (TMT) sector from an occupier perspective. We assess the dynamics and drivers of activity across key global technology hubs. The report provides a more detailed summary of recent activity in eight key hubs across the globe. We also explore the factors affecting the location choices of TMT companies and their implications for real estate.
Across most key hubs, the TMT sector continued to record strong activity in 2013. Notably in London where take-up rose 107% on 2012. In contrast, the US hubs of San Francisco and Silicon Valley saw declines of 55% and 34% respectively.
During 2013, the TMT sector was also characterised by high levels of M&A activity registering an increase of 54.1% on 2012 to US$510.3bn. This has been driven by strong balance sheets, low finance rates and a supportive lending environment.
On the supply-side, we expect the availability of flexible and scalable space sought by TMT companies to remain tight. This is likely to be compounded by a broader-based increase in demand. As a result we see start-up companies and the innovation divisions of larger ones continuing to cluster in lower cost fringe locations for affordability and flexibility reasons.
We also see strong demand for space in more emerging markets, including Sub- Saharan Africa, Eastern Europe and Latin America where activity is driven by the pursuit for increased market penetration and the rising competition for new talent within this sector.
Source : DTZ (Groupe UGL)