Renewed interest in Central London office space has meant that property under offer has risen by a fifth on a month-by-month basis. Nearly 3.5 million square feet of space were under offer by the end of November, around twice as much as at the beginning of 2009.
Analysts suggest that, if the decrease in available space is sustainable, rents should soon start to rise. As free space dwindles, competition for remaining space will push up the amounts that landlords are able to charge. London’s prime office space has seen a particular surge in investor activity in recent months.
At the same time, critics warned that the property market over the country as a whole would not return to growth for another year, with both capital and rental values continuing to decline. However, office space is expected to stage the strongest recovery when the upturn eventually arrives.