Global real estate adviser DTZ has revealed figures that show 6.5m sq. ft of London office space has been let within the city so far this year, with the amount of vacant real estate continuing to fall. With a drop of around 40% within the last 12 months, it leaves London City with less Grade A office space than the West End.
With a rapidly growing demand, there are attempts to keep meeting supply through constant new development activity. However, short term, it is estimated that supply will fall short of meeting demand.
“There are currently around 15 businesses, mostly in the tech, media and finance industries, actively searching for more than 100,000 sq ft – and there are just six buildings that offer that space. As a result of these supply and demand conditions, we expect prime rents in the City and West End to increase by more than 10% this year.
“This will be the highest growth since 2010 when the commercial real estate market bounced back after two years of negative growth post the global financial crisis. As businesses in London continue to expand and upgrade their headquarters, we will see competition for the best quality space intensify, leading to an even more active pre-letting market.”
By: Kirsty MacGregor
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