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London

Rapid urbanisation squeezing Londoners in to smaller spaces as the size of a one bedroom flat shrinks

Average size of a one bedroom flat in London is now only 47 sq m


 

London, 07 October 2015 – Rapid urbanisation in the UK is squeezing people in to smaller spaces as the average size of a one bedroom flat is now 47 sq m (505.9 Sq ft) and has increased the demand for self storage.

According to research conducted by FEDESSA and property consultant JLL, 82% of the UK’s population live in cities and the pressure on space in these urban environments is increasing, resulting in smaller living spaces and rising residential property prices. While London’s population hit an new all-time high of 8.6m this year, it’s also projected to rise above 10m by 2030. House price growth has been 8% per annum over the last five years, causing the percentage of the population renting to rise from 17% in 2001 to over 25% today.

Rennie Schafer, Chief Executive Officer of FEDESSA said:

“The FEDESSA annual survey shows that the industry in most European markets is once again showing solid signs of growth, in terms of expanding sites, new developments and new entrants to the industry. Furthermore we are seeing unprecedented consolidation of the industry as major operators that were previously largely growing through development of new sites now acquiring existing businesses. Such as the Shurgard acquisitions in Germany and the Netherlands, Big Yellow in the UK and recently Blue Space acquiring City Self Storage in Spain.”

Meanwhile capital flows into European Commercial Real Estate (CRE) have seen a significant rise over the past few years. Direct real estate investment volumes hit €102 billion in the first half of 2015, up 21% since 2014. The UK accounted for 40% of all European transactions in 2015. The weight of money coming into CRE has led to many investors being priced out of certain sectors in core locations, and concurrently looking increasingly at ‘alternative’ sectors such as healthcare, student housing and self storage. The alternatives space now accounts for 17% of all investment in Europe, up from 10% in 2010. The UK being the most mature of ‘alternative’ markets.

Ollie Saunders, Lead Director – Alternatives at JLL commented:

“Self storage operators are telling us that they are expecting a growth in demand for self storage. Some more developed markets – such as the UK and The Netherlands - are maturing; we have seen strong investor appetite for the sector as it has continued to demonstrate robust performance.

“With these track records, savvy investors and developers are looking to expand in emerging markets as the drivers of growth are now well understood in Europe. Investors have spent over €400m buying existing businesses this year, and the survey shows that more stores are planned to be opened to meet the continuing demand from consumers across Europe”

Find out more: European Self Storage Survey