Q2 2018: AMOUNT OF CENTRAL LONDON OFFICE SPACE UNDER OFFER REACHES 18 YEAR HIGH, SAYS CBRE
- Under offers rose sharply to 4.3m sq ft, the highest level since Q3 2000
- Midtown recorded 1.1m sq ft of under offers – highest ever level on record
- Take-up in Central London increased by 21% quarter-on-quarter
- Three transactions over 100,000 sq ft completed during the course of the quarter
The amount of Central London office space under offer increased by 39% over the course of the quarter to reach 4.3m sq ft, the highest level since Q3 2000, according to CBRE, the world's leading real estate advisor.
Under offers remained significantly above the 10-year average of 2.9m sq ft for the sixth consecutive quarter. The largest unit under offer at the end of Q2 was at 11/21 Canal Reach in King’s Cross, where 404,600 sq ft was under offer to a confidential occupier.
After a relatively weak first quarter, take-up rebounded strongly in Q2 2018. Take-up of office space increased to 3.5m sq ft, an increase of 4% on Q2 2017 and above the 10-year average of 3.1m sq ft. This took the H1 2018 total to 6.4m sq ft, ahead of the H1 2017 total of 6m sq ft.
Take-up in Q2 was led by an owner-occupier deal for the Chinese Embassy at Royal Mint Court, EC3, a multi-use development site which will include 520,000 sq ft of office space. This was one of three transactions over 100,000 sq ft which completed during the course of the quarter.
Flexible office providers were particularly active during the quarter, with take-up of 698,000 sq ft across 21 deals. The largest deal to a flexible office provider in Q2 was a 131,500 sq ft letting to WeWork at Aviation House, Kingsway.
After a relatively slow first quarter, the London office leasing market has rebounded in a remarkable fashion as occupier appetite for London office space reaches record levels, with under offers at an 18 year record high.