BNP Paribas Real Estate has published its latest Central London office market review. Key findings include:
- Annual take-up to the end of August reached 7.6m sq ft, 15% ahead of the same period last year.
- The impact of the Serviced Office sector is making itself felt, with sub-5,000 sq ft deals falling by 45% compared with the long-term average.
- Tenant space now accounts for 24% of total supply, up from 23% at the end of Q2. Banking and finance occupiers account for about one-third (36%) of tenant space.
- Investment volumes reached £2.21bn in July and August, taking annual levels to £10.62bn. In 2016 office investment totalled £13.33bn.
Dan Bayley, head of Central London office agency, said:
“The number of big deals and variety of businesses taking space show a vibrant and dynamic market.
“Larger corporates are active, with Deutsche Bank’s pre-let at 21 Moorfields demonstrating financial services’ commitment to London, and we are seeing rising demand from tech and creative businesses, particularly on the fringes of the West End.
“Our numbers show a drop in activity among small and medium sized businesses. This may be due to caution, but is also no doubt influenced by the rapid growth of the serviced office sector.”