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This Thursday, the long awaited football world cup starts and as always there has been a huge amount of build-up leading up to this much anticipated event. England’s chances do not seem great this year, but maybe that is a good thing as we often perform our best whilst being branded the underdog. Anyway, this entire nation has now unofficially agreed that no one will be turning up to work on the Monday if England wins the world cup.
There have been a couple of studies and papers written recently about how the world cup affects the economy, the main study being done by Goldman Sachs in ‘The World Cup and Economics 2014’ which aims to test the theory that there is direct correlation between the World Cup period and economic growth. It is clear that the World Cup will lead to growth in the host country with the influx of tourists into the country during that period. London was a beneficiary of this during the 2012 Olympics. But does the hysteria created by the World Cup in so many countries have a significant short and long term effect on the economy?
There is a huge amount of research done and a number of different conclusions drawn. One of the main conclusions is the that the World Cup does increase GDP growth in the longer term depending on how successful the team is during the competition. If the team does well there is a clear positive impact on sales of merchandise and importantly general consumer confidence which will have spill over effects into other parts of the economy.
More specifically, will this have an effect on the London office market? The simpler answer is probably not directly. However indirectly as with any market, this London office market is hugely effected by consumer confidence internationally. Therefore, in the long term there could be an argument to say that it could have a very small effect.
In the short term, if England do well in the World Cup the London office market will suffer as most agents will be celebrating for the rest of the summer.
This news was brought to you by Morgan Pryce, a specialist tenant acquisition agent with offices in Oxford Circus and the City. Morgan Pryce specialises in search, negotiation and project management and works exclusively for tenants.