‘Singapore on the Thames’: HSBC’s exit from London’s Canary Wharf seen triggering slide in home prices, agency says
- Developers will have to cut prices as the area needs a ‘significant redesign’ to draw visitors and residents, says LCP managing director
- Other analysts are more positive, citing increasing transport traffic to the district and a rising population of biotech companies
The bank’s decision to relocate appears ill-timed for developers in Canary Wharf, where prices have already slipped by 3.2 per cent over the last three years, in comparison to a 3.5 per cent increase in central London over the same span, according to data compiled by London Central Portfolio (LCP).
“With the recent news of HSBC’s decision to leave their Canary Wharf headquarters and move to the city, the area will need a significant redesign in terms of what else they can offer to encourage visitors and tourists to visit and professionals to reside there,” said Liam Monaghan, managing director at LCP.
Developers will need to reconsider asking prices, especially as rising interest rates and cost-of-living increases squeeze buyers’ budgets and reduce demand, he added.
Since December 2021 the Bank of England (BOE) has raised interest rates 13 times, raising financing costs to 5 per cent from 0.1 per cent over the period. As consumer inflation in the UK remains well above a 2 per cent government target, another rate hike is in the offing in August, albeit at a more modest 25 basis points, analysts believe.
