Head of Corporate Research, EMEA
This morning’s break-out session, highlighting an imminent short-fall of supply, was largely UK centric but the issues raised reverberate right around the EMEA region. Supply pipelines have been heavily curtailed given the global financial crisis and the accompanying reduction of demand. That much was clear from today’s presentation.
Four things struck me, however, that were less clear-cut, the focus of some debate and which are critical to the supply dynamic;
1. There may be a clear reduction in the volume of supply but the pain for occupiers is compounded by a lack of quality solutions amongst this supply.
2. This lack of quality, fit for purpose space solutions can only be be addressed through a much needed and honest dialogue between the supply side and the end user.
3. The shortfall will be exacerbated by demand. There was a suggestion in the room that there is no growth so there is no demand. This does not compute with reality. Whilst growth for many occupiers is a way off, many are seeking to consolidate or rationalise space and will have a need to go to market thus further eroding already scarce supply.
4. There must be a growing recognition that solutions can be sought from existing stock. Rennovations and refurbishments can provide a strong and potentially more timely solution for many occupiers.
There is much talk in the wider market of a supply led recovery. One man’s recovery is another man’s pain. Savvy occupiers need to face up now to the future supply dynamic, begin dialogue about space needs with the supply side and seek solutions before the pain becomes even more intolerable.
View more EMEA reasearch on our dedicated blog: From the Roof