Pinch point approaching for Grade A offices in Western Corridor – Jones Lang LaSalle
The supply of Grade A office space in the Western Corridor has fallen to its lowest since 2008, says Jones Lang LaSalle. The firm’s latest research says there is a “compelling case for speculative development” in several key town centres in this area, west of London, where Grade A supply is particularly limited but demand has been focused.
Jones Lang LaSalle says Reading town centre, Maidenhead town centre, Uxbridge, Staines and Egham are all development hot-spots for office space in the Western Corridor.
The firm expects rents for the best office properties in the area to jump in 2012, in places where the supply remains limited. It notes that there is an opportunity here for property owners to convert Grade B space into Grade A supply before this ‘pinch point’ arrives next year.
While investment activity in the area picked up during the first half of this year, JLL says, the limited supply available has continued to restrict volumes overall. Prime yields have stabilised at 6.50% in the Thames Valley and West London, it notes, although in some instances these may tighten further.
