With our strong interest in competitiveness we were pleased to note that London once again tops the Global Financial Centres Index (GFCI) in 2016. The GFCI published by the Z/Yen Group examines the major financial centres globally in terms of competitiveness. However with New York only eight points behind (on a scale of 1000) the two cities remain competitive.
London will need to work to retain this status over the next year, not least due to the upcoming EU referendum. This, in conjunction with challenges such as housing shortages, transport and energy inefficiencies as well as issues surrounding public security mean that London and London’s new Mayor, perhaps now more than ever, need to plan for the future.
One way to remain an attractive place for businesses, workers, residents and visitors would be to consider a range of outcomes underpinned by ‘smart’ solutions that can enhance the city’s reputation as a global leader. These could take the form of smart buildings and infrastructure, community services and e-governance and green technologies which improve air quality, energy efficiency and promote healthy lifestyles. This is a key priority for the Greater London Authority who has set up the Smart London Board. As detailed in their recent publication ‘Smart City, Opportunities for London’, London provides a fertile environment for smart city businesses to set up, grow and flourish.
In the GFCI report, London just managed to retain its edge over New York, in part, due to its booming financial technology sector. For London this, and the expansion of small and medium sized businesses (SMEs), will inevitably be a growth areas for the future.
Our latest report ‘Clusters and Connectivity: The City as a place for SMEs’ analyses the opportunities that a location in the City offers and the challenges emerging from increasing pressure on SME workspace. The City is a thriving place for 16,000 firms with fewer than 250 employees. These businesses make up 98.6% of all businesses located in the Square Mile and employ around half the workforce.
Yet this growth has not come without challenges. Vacancy rates in the City are at, 3.9%, their lowest level since 2001, illustrating the pressures on space. This pressure is particularly marked for floorspace of 300-1000 sq m, often regarded as move-on space for growing firms.
The City therefore needs to look at measures that can safeguard the provision of attractive and cost-effective space for the varied and dynamic community of SMEs. This includes the potential use of protected heritage buildings for small office space, and working with developers to promote the inclusion of affordable space for start-ups in future large developments. The recommendations in this report will help to ensure that the vast array of businesses that make up such an important part of the economy in the City can continue to thrive and ultimately contribute to London’s status as a leading global financial centre.