While all cities across the UK (including London) suffered as the credit crunch became a recession in 2008-09, the recovery has been less balanced as regional economies have tended to lag behind London, which has been highly resilient. London’s relative outperformance resulted not only from its enduring strength, which helped drive rental growth, but also investors, both domestic and international, who perceived the capital as a safe haven.
That said, the tide is now turning. Private sector job creation is spreading into the regions and businesses, feeling more confident, are making strategic decisions about their future space requirements. Office property investors, who for much of the last five years, have been focussed on London and the South East are looking further afield, with the overall number of investment deals in Q4 2013 set to reach the highest level since 2008.
Source : M&G Real Estate