Central London Office Market Outlook
Companies moving office in London should take a note of the forecast for the Central London Office Market when planning their office move.
There is no denying that 2011 was a tough year for the Central London Office Market, and for the most part, 2012 looks likely to be another. 2011 saw the biggest shortage of commercial property since the 1980s, for prime office space in particular. Fears over the UK economy means that companies are looking at how they can keep a check of their overheads over the coming years, and in particular their real estate strategies.
For companies planning an office move in 2012 in Central London, they should be open to other areas such as Midtown or Docklands as it will give them a better opportunity of finding their ideal office space without being restricted to the low supply of office space that is currently lacking in the West End.
The amount of space under construction in Midtown and on the market has risen to 410,800 sq ft, an increase of 33%, and space being actively premarketed is up by 9% from the previous quarter. The majority of space available is secondhand, which may well suit companies looking to reduce their overheads during this period of uncertainty.
The TMT (Technology, Media & Telecommunications) sector is currently driving office space demand across Central London, accounting for 22% of take-up across the City market and 39% in the West End market. Even they are being forced to look outside the traditional Soho/Covent Garden locations in order to satisfy their office space requirements.
The latest London Office Market Report from Estates Gazette states that "Uncertainty is the mood that will dictate performance throughout the London office market in 2012. However the number of unsatisfied office space requirements has been slowly but surely rising in 2011, and Central London Property Agents agree that there is good reason to expect a revival of confidence towards the end of 2012".
If your Central London office lease is expiring in 2012, or you simply need to review your office space requirements, talk to a London Property Agent.
