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Govt Prime Location Exodus Stimulating London Economy

By +Eric Jafari

Govt Prime Location Exodus Stimulating London EconomyThe government's move to relocate civil servants from some of the most sought-after locations in central London to more appropriate buildings has proven to be a major stimulus for the capital's economy. Minister for the cabinet office, Francis Maude revealed that by consolidating and rationalise public estates, £3.5 billion has been injected into the city.

After analysing 16 selected properties, Knight Frank claim that almost a billion pounds has been invested by the private sector in redeveloping outmoded former government offices. Following the exodus of public officials, units have either been pulled down, replaced, refurbished or adapted for business, commercial and residential purposes.

Mr Maude commented: "My department's Efficiency and Reform Group has helped save over £640 million for the taxpayer by getting to grips with our property estate and selling over 250 surplus buildings. This is part of an overall strategy which has saved the taxpayer £12 billion since May 2010.

"We're determined to help boost the economy by reducing the cost of the public sector and allowing the private sector to flourish - Knight Frank's analysis shows our work has reverberated through the property and construction sector to stimulate London's economy and they suggest it's given our capital a boost of over £3 billion."

This has been part of a large drive to change the way the government works in the UK, ensuring it is a more reactive, efficient, smaller and technologically aware entity. Mr Maude believes that civil servants are now in need of more modern office space, with better IT facilities and the ability to work from different locations. This will in turn enable the government to cut costs and redistribute savings back into the economy.

For investors, this means an influx of new prime stock, prime for redevelopment. With high-quality central London office units in short supply, this will be welcome. Reducing the size of the government's London estate is also good news for those hoping for decentralisation, encouraging more activity out of the City.

12 February 2013

Tags

London Prime Property Market,Francis Maude,Public Estate,London Economy