savills.com

London as a Global CityYolande Barnes, Director, Savills World Research

9th June 2014

Everyone comes to London

... making it one of the UHNWI hotspots

... but this isn’t just about posh houses

34%

66%

London primeresidential

InternationalDomestic

Source: Savills World Research, Office/Retail/Hotel: RCA (transactions in 2013), UK quoted shares: ONS (holdings in 2012), Infrastructure: OFT (2010 ownership)

43%63%

London retail

7%

63%

London mainstream residential invest-

ment

54%63%

London hotel

57%63%

London office

53%63%

UK quoted shares

38%

63%

UK infrastructure & utilities

London is globally prominent & active

... and London’s economy is nationally dominant

New York

Shangh

ai

Hong K

ong

Mumba

i

Tokyo

Moscow

Rio de J

aneir

o

Lond

onParis

Sydney

Singapo

reDubai

0

2000

4000

6000

8000

10000

12000

14000

16000

0%

5%

10%

15%

20%

25%

30%

35%

40%

Country GDP City GDP City share

Source: Brookings Institute 2012, IMF 2012

...although higher resi price bands are most ‘global’

Source: Savills (2010-2013)

Lower Mainstream (Less than £450psf)

Mid Mainstream (£450psf to £700psf)

Upper Mainstream (£700psf to £1000psf)

Lower Prime (£1000psf to £1500psf)

Upper Prime (£1500psf to £2000psf)

Super Prime (£2000psf+)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

74.7%62.8%

37.8%26.3%

13.1% 10.6%

13.4%27.6%

40.5%49.1%

53.4%

18.1%

UK China and Pacific Asia Eastern Europe and The CIS

North Africa and the Middle East Western Europe including Nordic Countries Africa

South Asian sub-continent North America Latin America

Pro

porti

on o

f Pur

chas

ers

Why London?

Personal safety

Security of tenure

Politically stable

English language

Quality of education

CosmopolitanFavourable tax regime

Established judicial system

Strategic time zone

Culture and heritage

Globally connected

Open for investment

Secure title

Ease of doing Business

Market transparency

Market liquidity

Established investment track record

Global purchasers are not a new phenomenon

1980 1990 2000 2013/140%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

42%29%

48% 49%

Prime Central London Buyer Profiles

International UK

Source: Savills Research

London has high no. of residents born outside the UK

Source: Census 2001 & 2011

... as shown by second languages

So is ‘lights out London’ real?

Source: Savills Research

Is London Overheated?

Source: Savills World Research

Price Growth varies across London

RBKC

H'smith

& Fulha

m

Islingto

n

Southwark

Lambe

th

Haringe

y

Tower H

amlets

Ealing

Lewish

am

Walt

ham Fore

st

Hounslo

w

Harrow

Sutton

Green

wich

Croydon

Bexley

Barking

& D

'ham

0%

30%

60%

90%

120%

150%Since June 05

Source: Land Registry

... so non-prime London still looks good value

Key drivers: quality of place

travel time to centre

Source: Savills

... so expect more of this

Source: Savills Research

19% of developments over 200 units in inner London currently under construction were funded by overseas entities