Development pick-up to meet London office demand growth
Competition for office space in central London is fierce presently as a result both of high demand from occupiers in Europe’s principal financial centre and office market, and of limited supply. There are now signs that developers are moving projects from the planning stage to implementation. While this will not ease the demand/supply situation in the short term, projects already in the development pipeline should come to fruition and occupiers will know that space and rent pressures should ease toward the end of the decade. That timeframe, though, may not fit in with their plans.
According to Richard Proctor, partner, central London tenant representation, at Knight Frank, the office vacancy rate in central London fell to 4.8 percent in Q2 2015, a 14-year low and a number seen previously during the “dot.com” boom of 2000–2001. “The Q2 2015 figures show that choice for occupiers is limited,” says Procto