Ownership, occupation and risk: a view of the City of London office market

Office returns in the City of London are more volatile than in other UK markets. This volatility may reflect fluctuations in capital flows associated with changing patterns of ownership and the growing linkage between real estate and financial markets in the City. Using current and historical data, patterns of ownership in the City are investigated. They reveal that overseas ownership has grown markedly since 1985, that owners are predominantly FIRE-sector firms and that there are strong links between ownership and occupation. This raises concerns about future volatility and systemic risk in a market strongly influenced by the cyclical behaviour and shocks of the international financial system.

Achieving carbon reduction from listed buildings in the UK: A case study on The Royal Academy of Engineering, London

A carbon reduction strategy for a historic Grade 1 listed office building in London is presented. The study evaluates the impact of49 different carbon abatement options, quantified using building simulation software, auditing procedures and qualitative methods. The impact of each option is assessed against three criteria: carbon abatement potential, practicality and cost. The strategy comprises of18interventions,integrated within 12 key recommendations. Accumulative reduction of 37% (below a 2009 carbon emissions baseline)appears achievable and only feasible with heavy reliance on changes in occupant behaviour. This theme appears central in achieving realistic and significant carbon savings from listed buildings, where planning constraints relinquish potential for major building fabric alteration and renewable energy installations.

Capital market expectations and the London office market

The analysis of office market dynamics has generally concentrated on the impact of underlying fundamental demand and supply variables. This paper takes a slightly different approach to many previous examinations of rental dynamics. Within a Vector-Error-Correction framework the empirical analysis concentrates upon the impact of economic and financial variables on rents in the City of London and West End of London office markets. The impulse response and variance decomposition reveal that while lagged rental values and key demand drivers play a highly important role in the dynamics of rents, financial variables are also influential. Stock market performance not only influences the City of London market but also the West End, whilst the default spread plays an important role in recent years. It is argued that both series incorporate expectations about future economic performance and that this is the basis of their influence upon rental values.

"Oft expectation fails": a time-series analysis of construction starts in the London office market

Expectations of future market conditions are generally acknowledged to be crucial for the development decision and hence for shaping the built environment. This empirical study of the Central London office market from 1987 to 2009 tests for evidence of adaptive and naive expectations. Applying VAR models and a recursive OLS regression with one-step forecasts, we find evidence of adaptive and naïve, rather than rational expectations of developers. Although the magnitude of the errors and the length of time lags vary over time and development cycles, the results confirm that developers’ decisions are explained to a large extent by contemporaneous and past conditions in both London submarkets. The corollary of this finding is that developers may be able to generate excess profits by exploiting market inefficiencies but this may be hindered in practice by the long periods necessary for planning and construction of the asset. More generally, the results of this study suggest that real estate cycles are largely generated endogenously rather than being the result of unexpected exogenous shocks.

Asymmetric space market adjustment in the London office market

Models of the City of London office market are extended by considering a longer time series of data, covering two cycles, and by explicit modeling of asymmetric rental response to supply and demand model. A long run structural model linking demand for office space, real rental levels and office-based employment is estimated and then rental adjustment processes are modeled using an error correction model framework. Adjustment processes are seen to be asymmetric, dependent both on the direction of the supply and demand shock and on the state of the rental market at the time of the shock. A complete system of equations is estimated: unit shocks produce oscillations but there is a return to a steady equilibrium state in the long run.

International investment, ownership and risk in the City of London office market: an analysis of trends 1972-1997

Office returns in the City of London are more volatile than in other UK markets. This volatility may reflect fluctuations in capital flows associated with changing patterns of ownership and the growing linkage between real estate and financial markets in the City. Using current and historical data, patterns of ownership in the City are investigated. They reveal that overseas ownership has grown markedly since 1985, that owners are predominantly FIRE sector firms and that there are strong links between ownership and occupation. This raises concerns about future volatility and systemic risk.

Ideology and the by-passing of the planning system: case studies of Canary Wharf, London and The Globe, Stockholm

This paper explores the relationship between political ideology and planning in Britain and Sweden, with particular emphasis on the by-passing of the planning system. The prevailing ideology in each country over the last ten years is outlined and the impact on planning identified. The argument is then given in greater depth through case studies of two major projects. For Britain, this involves setting out the main features of Thatcherism and the way that this has changed the purposes underlying planning and created a diversified planning system. This is followed by a case study of Canary Wharf. For Sweden, the consensus culture and the emphasis on participation and decentralisation are discussed. The new planning legislation of 1987 is outlined. These aspects are then contrasted with the fiscal crisis and the development of 'negotiation planning'. These themes are illustrated by a case study of the Globe in Stockholm.

Economic and political influences on urban planning: a comparison of London, Paris and Berlin

This paper addressed the degree of autonomy experienced by the planning regimes of London, Paris and Berlin. What variation exists in the governance of these cities and how do national, local, political, business and community interests effect planning decisions? The discussion is placed in the context of the literature on world cities and growth coalitions and the debate over whether economic forces compel cities to follow similar strategies. The paper concludes that in the case of the three cities examined there is considerable variation of planning approach due to different historical, cultural and political factors.

Protein structure prediction servers at University College London

A number of state-of-the-art protein structure prediction servers have been developed by researchers working in the Bioinformatics Unit at University College London. The popular PSIPRED server allows users to perform secondary structure prediction, transmembrane topology prediction and protein fold recognition. More recent servers include DISOPRED for the prediction of protein dynamic disorder and DomPred for domain boundary prediction.

Trends in office rents in the City of London: 1867-1959

This paper details the construction and analysis of a dataset of office lettings, which is used to produce a rent index for the City of London spanning the late nineteenth and early twentieth centuries. It advances prior research through application of a modern version of the repeat measures technique and in coverage of years where office rents have not been previously measured. Results show that there has been no real growth in rents over the period as a whole. However, there have been distinct phases of rental growth and decline that correspond with the wider economic fortunes of the City.