Banks boost London office take-up – Knight Frank
Demand from banks and other financial services companies for office space in London has rebounded, according to figures out from Knight Frank, which says the take-up of office space in central London by the financial sector jumped to 6.4m sq ft last year. This compares with 5.3m sq ft in 2006 and 4.5m sq ft in 2007, before the credit crunch hit the UK.
The firm says that lease breaks due in the next three years mean that demand from banking groups is expected to remain strong, although the impending tighter regulatory environment is still hanging over the sector. Knight Frank said available office space in London has fallen to 18.3m sq ft from 23m sq ft a year earlier – which has driven rents upwards by 25% in the City of London to £55 per sq ft and 31% higher in the West End to £85 per sq ft. The figures, reported in the FT, include Knight Frank’s forecast that City rents are set to rise above £71 per sq ft by the end of 2014 as supply remains constrained.
Meanwhile, the Times reports today that Prupim is seeking a joint venture partner for its GreenPark business park on the M4 near Reading. The paper quotes a Prupim spokesman as saying that the property fund manager wants to reduce its exposure to GreenPark, given its high capital value. It is thought that Prupim might entertain a bid for the whole asset – which would have to be near £400m – if a buyer came forward. The Times notes that investor interest in business parks has been high since the sale of Chiswick Park earlier this month for £480m.
