Office take-up in central London in the first half of 2017 has reached 5.5 million sq ft, marking a 23% increase on the corresponding period last year and the 10-year average – both 4.5 million sq ft, fresh data shows.
Take-up has increased in both London’s City and West End markets driven by ongoing strong demand from tech, media, insurance and financial markets in both the City and West End.
This increased activity sees 36% of the City’s development pipeline for 2017 – 2020 already pre-let, and 29% for the West End market, according to Savills, which compiled the report.
Overall, at the end of H1 2017, 11.8 million sq ft of space remains available across central London according to the research, equating to a vacancy rate of 4.8%. For comparison, Savills 10-year vacancy rate average currently stands at 5.8%.
Savills says strong activity has seen average prime rents in the West End rise to stand at £118.23 per sq ft, 7% above 2016’s average prime rent.
Stuart Lawson, director in the City leasing team at Savills, said: “The first half of 2017 has been notably strong as occupiers remain committed to central London and acquire new office accommodation in order to support ongoing long term business.
“Whilst the events of the last year have made some occupiers pause for thought, the statistics indicate resilient take-up across all size sectors, which is promising. Looking ahead to the second half of 2017, accommodation currently under offer is also strong, standing at 2.9 million sq ft, which is also ahead of the long term average.”