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London

Shoreditch, Aldgate and Clerkenwell now core London markets

According to JLL’s ‘Understanding Digital London’ research


London, 22 May 2014 – As a result of rising office rents and residential values,  increasing demand from corporates and a growing prime development pipeline, Shoreditch, Aldgate and Clerkenwell should now be classified as core London markets, according to new research from JLL.

The report claims that the area once known as ‘City Fringe’ has transformed to become an established part of the London office market. As a result of rising demand, a new building in the area would command rents comparable to the City core. Prime rents here currently stand at £60psf.

Jon Neale, head of research UK at JLL and author of the report said: “Due to the growing success of these areas, we have decided to retire the term ‘City fringe’ and instead classify Shoreditch, Aldgate and Clerkenwell as submarkets in their own right. Each has different characteristics; Clerkenwell is increasingly a new medialand to complement Soho, whereas Shoreditch is home to an important digital-creative cluster. However, all these markets are very diverse in their occupier base.”

“Demographic change in wider East London has been instrumental in making the area more attractive to businesses. The boroughs of Hackney and Tower Hamlets have seen the highest recent levels of population growth of any London boroughs and this has been complemented by a young, skilled and often international workforce moving to the area. An increasing number of companies in different sectors want to co-locate with the growing cluster of businesses in the digital-media, digital-commerce and creative-digital space.

“We have also found that companies are widening the net in the search to find office premises and are no longer confining themselves to traditional locations. To this end, larger corporates are now looking outside of more traditional City locations to secure the space they need, with Shoreditch, Aldgate and Clerkenwell proving popular, partly because the range and depth of amenities can help recruitment and retention.”

The report highlights that increased interest in commercial and residential space in the area has led to a surge in development. The current speculative pipeline is scheduled to deliver an additional 20% of high-specification office stock and almost 5,000 residential units to the area and the arrival of Crossrail will transform the area.

The report argues that the provision of co-working space and a mix of uses – including residential – will be important if the area is to retain its character while maturing into an international business hub.​