Demand for office space in London looks set for a massive drop by the end of 2009, with ever increasing competition from desk space Cambridge, Manchester, Liverpool and other main commercial UK cities.

If vacancies rise, the cost of rents will, almost certainly lower. An inevitability that was confirmed by Bryan Laxton, chief executive for worldwide investors, Cushman & Wakefield. Songbird Estates PLC own millions of square feet of office space at the Docklands. The company have been given a deadline by Citibank, May 2010, to repay the £880 million loan they received to invest in the Canary Wharf.

If the demand and cost of office space in London falls as predicted, Songbird has 553,000sq ft of space up for renewal over the next 5yrs. Even if the companies decide to renew their lease, income will almost certainly fall. Only last year Songbird were charging more than ten percent above average rents in the capital, something which is highly unlikely to continue. If the predictions come true, this will definitely exacerbate Songbirds current financial difficulties.

The company are taking advice from Rothschild & Sons, in a bid to find a solution to their current financial problems. But things only look set to become worse for Songbird Estates PLC.

Shares in the company have plummeted by seventy percent, their assets by eighty percent. The company did state only one month earlier, that “material uncertainty” could leave the company