Competition Competition is increasing due to a persistent shortage of good quality supply, future office demand and the impact of tenant release space, which is limited. An increasing pool of equity is chasing London and UK-wide opportunities alongside increased competition for sites from alternative uses. Technology Increased competition from investors for market-ready space that’s high quality, sustainable and tech-enabled. Technology trends are accelerating, with Proptech becoming commonplace in new and refurbished stock. Cost of delivery/CapEx There are higher costs from procurement delivery and compliance and ESG which are delivering swift higher net effective income yields. There’s an increased focus on office design meeting the needs of the hybrid post-COVID-19 workforce and enabling creativity, collaboration and reinvigoration. Regional availability There’s increased demand for high-quality, well connected, serviced office space close to amenities and transport hubs to support emerging flexible post-pandemic work models. Challenges in the sector 20 Real Estate Investment 2022