Jump in Central London office leasing activity – CBRE
Leasing activity for Central London offices picked up sharply in May but was still below the long-term average, says CBRE in its latest overview of the sector. Take-up of office space in Central London last month totalled 811,000 sq ft, a jump of 96% from April, but compares with a long-term average of 970,700 sq ft.
Dan Roberts, executive director at CBRE, said the increased take-up was particularly significant when viewed alongside the fact that the level of space under offer also rose strongly in May, to 2,37m sq ft – above the long-term average of 1.93m sq ft and the highest level seen since November 2011. This was despite the completion during May of the Prudential Regulation Authority’s deal to take 151,900 sq ft of City office space at 20 Moorgate. “We expect the healthy levels of active demand and upcoming lease events to drive take-up in the coming months,” he added.
The PRA’s deal is only the second transaction of more than 100,000 sq ft so far this year. CBRE notes that there were six other deals during May of 20,000 sq ft or more in Central London, out of a total of 93 transactions.
Availability fell by 2% during May to 16.94m sq ft, after five consecutive months of increases. There are currently 27 units that can satisfy a requirement of more than 100,000 sq ft available in Central London, with the largest being at the soon-to-be-completed Shard building at London Bridge where 589,600 sq ft is available in total.
CBRE notes that a total of 6.17m sq ft of office space in Central London has lease expiries or breaks during 2013, to be followed by an expected further 7.29m sq ft in 2014 and 7.19m sq ft in 2015. The firm says that while this will drive requirements in the near future, actual take-up will depend heavily on an upturn in occupier confidence.
