London Tech Companies Take Up More Space Than Every Other Industry

It is no secret that London is fast becoming a hub of tech startups. Indeed the past few years have seen an incredible number of tech companies starting up in the capital, and recent research from Knight Frank, the estate agents, has shown that tech companies are now taking up more of London’s office space than any other kind of industry.

The breakdown from Knight Frank showed figures from the last four years of how much office space each of London’s biggest sectors had acquired. It showed that Technology, media and telecoms had acquired 12.5 million sq ft and therefore was at the top of the leader board by over 4 million sq ft. Financial firms came next, having acquired 8.0 million sq ft, then came professional services (i.e. lawyers and accountants) with 5.6 million sq ft.

Shoreditch appears to be the centre of the tech hub, with Knight Frank confirming that this has caused rents to increase by a total of £25 per sq ft, from £40 to £65, which means the area is only just a tiny bit cheaper than London’s Square Mile, where you pay £66.50 per sq ft.

Knight Frank broke their research down further, explaining how Shoreditch is now “becoming a location for stage two tech firms who are acquiring the size and characteristics of mainstream companies”. The estate agents also confirmed that they had seen a shift in the behaviour of the startup scene, which “is now migrating towards districts further east, like Whitechapel”.

The company believe that this progression in the market is healthy, as it will encourage these stage two tech firms to continue to expand out of their “startup incubators and into modern offices”, helping them to become the “future Googles or Amazons”.  Knight Frank also believes that London as a whole will also benefit, as more and more startups start spreading into other parts of the capital.

An additional report, released in December put forward the notion that the huge boom in new office spaces being constructed was being driven by the ever-growing tech sector of London. The report provided details on the tech companies that had moved in new offices in London, which included:

  • Google (800,000 sq ft, Kings’ Cross Central in 2013 and c.550,000 sq ft, also in Kings’ Cross);
  • Facebook (87,586 sq ft at 10 Brock Street in 2013, and in 2015 65,000 sq ft at 338 Euston Road and 216,000 sq ft at Rathbone Square);
  • Amazon (212,000 sq ft at 60 Holborn Viaduct 2013 and 431,000 sq ft at Principal Place in 2014);
  • (24,900 sq ft in Central St Giles in 2013, 35,800 sq ft in Seven Dials Warehouse in 2014 and 65,170 sq ft at 180 Wardour Street in 2015);
  • and Skype (88,800 sq ft at 2 Waterhouse Square in 2012).