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London’s TechCity Faces Competition from Canary Wharf

by Jo Meunier
March 25, 2013
in Business
Reading Time: 3 mins read
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London CanaryWharf

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Business centres courting financial firms in London’s Canary Wharf could find a completely different set of businesses heading their way.

Canary Wharf, London’s second financial centre, is a powerhouse of banking firms working shoulder to shoulder. Home to many of the UK’s tallest buildings and the instantly recognisable One Canada Square, it’s where firms like Barclays, Credit Suisse, HSBC and Thomson Reuters call home.

But nestled amongst the suits and traders that fill Canary Wharf’s soaring office towers is a growing army of firms that deal not in currencies or stocks or shares, but in servers, HTML and SEO. A new generation of business sectors are changing the face of Canary Wharf, and they’re bringing their own acronyms too. TMT (Technology, Media and Telecommunications) companies are big business, and they’re muscling into new territories to get closer to their clients and pave the way for prestigious new business opportunities.

FinTech

Among them, FinTech (financial technology) businesses are creating quite a stir. John Garwood – company secretary of Canary Wharf Group – recently commented on the growth of technology firms in this traditionally financially orientated area of London.

“Twenty years ago lots of our clients were in the financial services sector and the demand was for technologically sophisticated buildings with big floorplates,” he said, according to Building Design, “so we built that space for them. Now the market is changing. Demand is coming from other business sectors and we’re looking at a mixture of options to meet this new demand.”

Canary Wharf Group is addressing this shift by developing space with smaller office floorplates specifically for SMEs from the TMT sector, with schemes like Wood Wharf – located east of Canary Wharf – coming to fruition.

TechCity 2.0

For business centres and virtual office suppliers, technology firms setting up shop in London’s corporate financial district is a trend worth watching. It is also notable that these firms are apparently shunning traditional tech-focused environments, including TechCity – the government’s £50 million attempt to rival California’s Silicon Valley.

TechCity is a media and technology hub based around Shoreditch and Hoxton, which is designed to provide office and incubator space for fledgling TMT firms. It’s backed by largescale investors including Cisco, Facebook, Google, Intel and Vodafone. And yet some start-ups are choosing the skyscrapers of Canary Wharf over the collaborative spaces and trendy vibe of Shoreditch.

Of course some TMTs are chasing the money in Canary Wharf. But financial clients aside, the region’s appeal could have a lot to do with increased accessibility and flexible workspace solutions – along with a brand new incubator space known as Level39.

Level39, Europe’s largest accelerator space for TMT start-ups, has just opened. Occupying the entire 39th floor of One Canada Square, it’s right in the middle of those all-important financial firms, and it’s got oodles of prestige too.

Affectionately known as TechCity 2.0, this new space is the brainchild of the Canary Wharf Group’s chairman and CEO, Sir George Lacobescu CBE. With its panoramic views, cutting-edge design (by Gensler – the architects behind Facebook and Google’s offices), a bar, and iPad controlled coffee machines, it’s a clear rival for TechCity. And it’s got the backing of London Mayor Boris Johnson too.

Its combination of fixed and shared desks are already over-subscribed, which is testament to the level of demand by FinTech firms to set up in less conventional areas like Canary Wharf.

While financial sector tenants are still expected to drive a large portion of demand in Canary Wharf, the region is steadily diversifying. The technology sector is growing, and business centres eyeing a new London location should pay attention to these emerging trends. Consider appealing to growing TMT businesses in London’s traditionally less tech-focused areas such as Canary Wharf. Servcorp and Regus are already there, and have been for some time. Could you do any better?

Image – Canary Wharf

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Jo Meunier

Jo Meunier

Jo is Allwork.Space's Senior Editor for the UK and Europe. Jo has worked within business centre and coworking circles since 2009, researching and contributing written features for numerous industry publications. She reports on the latest market news and delves into local issues with one main objective: to champion the flexible workspace industry and its members.

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