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Tech Giants And WeWork Overtake Banking Bluebloods As Biggest Occupiers In London

News emerged late last week that Facebook has appointed Cushman & Wakefield to find up to 700K SF of new office space in London. Bloomberg reported it is already in talks to take 400K SF at Kings Cross Central, where Google is building a 1M SF office.

Technology has long outstripped financial services as a sector in terms of London office absorption. But now individual tech companies are overtaking the eminent European and U.S. banks that have long held the title as the largest office occupiers in the capital. Banks are shrinking just as tech companies are expanding.

As of mid-2016, Goldman Sachs was the largest office occupier in London, according to data from Cushman & Wakefield, with 1.7M SF. But Goldman is in the process of building a new headquarters. The finance giant will vacate all four office buildings on Fleet Street and consolidate into a 850K SF office in 2019.

Among the other top 10 firms on Cushman’s list, HSBC has dropped from 1.7M SF to 1.3M today; Royal Bank of Scotland has shrunk from 1.3M SF to less than 1M SF; Deutsche Bank is consolidating its 1.1M SF to a new 550K SF office; and Citi is subleasing space at its 1.1M SF office and looking for a new 700K SF space.

You can debate whether WeWork really is a technology firm as it claims. But what is certain is that it will soon be London’s largest office occupier, with 1.5M SF in the pipeline and plans to keep expanding.

Among the pure technology firms, Google will occupy at least 1M SF and possibly more than 1.4M SF if it retains its existing offices.

Facebook currently occupies 370K SF across two offices — if it does take another 700K SF it will take its space past 1M SF.

Amazon occupies 920K SF. Apple, the largest company in the world, is a relative minnow on this list. The tech titan will be taking a 500K SF office at Battersea Power Station.

Barclays and HSBC are keeping up the fight in banking, with 1.3M SF apiece, as is JP Morgan with 1M SF. Serviced office firm IWG is the biggest occupier in London with 2.3M SF, but tech mega-firms are quickly becoming the dominant force in London offices.

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