West End Letting Market
The West End office leasing market continues to exhibit the strong activity of Q1 with over 2M sq ft of space being transacted over the first half of the year to date
The second quarter of 2019 has seen the West End office leasing market continue to exhibit the strong activity of Q1 with over 2M sq ft of space being transacted over the first half of the year to date, which is circa 25% above the long term average.
Pre-Letting activity has continued to be buoyant accounting for 30% of deals of the year to date, with a further rumoured 350,000 sq ft of the development pipeline currently Under Offer.
Tech & Media continues to be the dominant tenant sector with 29% of take up, followed by Financial and Insurance (25%) and notably the Public Sector, completing on 3 transactions over 45,000 sq ft equating to 18% of the market. The appetite of the serviced office sector to increase its market share continues apace with operators securing a further 18% of the total take up in Q2.
The vacancy rate has remained broadly static at 4% since the start of the year, although there has been a notable increase in the amount of “grey” space coming to the market this quarter with a combined 70,000 sq ft placed on the market via tenants in One Carlisle Place, SW1 and UK House, W1.
In the face of resilient demand and reducing Grade A supply, rents have remained at robust levels with a handful of transactions indicating a slightly upward trend.
There have been a number of significant deals over the last 3 months, notably the successful pre-let at One Soho Place, W1 (102,600 sq ft to G Research), the letting of the entire of 64 Victoria Street to the Parliamentary Estate on a new 15 year lease, and a new record rent achieved in Mayfair at 30 Berkeley Square, where Steadview Capital secured 2,572 sq ft at £250.00 per sq ft.
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