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For providers of office space, if coronavirus turns out to be a one-off hit, with just two quarters of rents deferred, there is little reason for property values to be affected at all.<\/p>\n
But instead, coronavirus might actually have a massive influence on the sector. After all, if the housing market changes as people look for more suburban and rural properties where they can work from home, there will be less need for office space to work in.<\/p>\n
The office property market will therefore have to adapt, something Prof White believes the industry is very good at.<\/p>\n
As he explains, if you strip out inflation, “average rents in London are the same as they were 100 years ago”. He says this shows that the office property market has been very good at matching supply and demand for a very long period of time.<\/p>\n
As the UK’s capital needed more offices in the 1950s and 1960s, many of the townhouses of the West End were converted from residential to commercial use. Then the City of London was rebuilt in the 1980s, with skyscrapers appearing, and Canary Wharf was constructed in London’s former docklands in the 1990s.<\/p>\n
Recently, as London has needed more accommodation, buildings including office blocks have been turned back into flats and apartments. <\/p>\n<\/div>\n