INDUSTRY NEWS

City of London worst hit by crunch

The City of London has been worst hit by the effects of a weakening commercial property market, a new survey has revealed.

The Drivers Jonas Crane Survey showed demand weakened across Central London despite their being 1.3 million sq ft of planned developments during the first quarter.

"Weakening demand comes at the same time as construction activity is at its highest since the early 1990s," the study found.

However, it predicted better prospects away from the City and noted "developers can be more upbeat as building activity in general remains more constrained".

It revealed there were only 26 new developments in the last six months and expected there to be undersupply in 2011 and 2012.

Anthony Duggan, partner and head of research, said: "It’s a symptom of the dynamics of the property market that means that construction is still rising while the demand dynamics are heading in the opposite direction."

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