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Even though plans are constantly submitted for new commercial properties, the Central London property market is continuing to experience a gulf between supply and demand. This has resulted in knock on effects in the capital’s core markets, with the City experiencing some of the lowest vacancy rates in its history. The area has seen small, medium and large floorplates all experiencing a negative availability to take-up correlation; in the end of 2015, the City had approximately 35 percent less floor space available than the same time previous year.
Q3 2015 also saw an increase in take up throughout the city compared with 2014, with a 13 percent quarter-on-quarter increase by floors, in addition a 14 percent increase by volume of space according to Gerald Eve – City Office review. 2015 experienced a total of over 1.85 million sq. ft. acquired during Q3 – the highest volume in 2 years.
Fraser Williams, Director and surveyor at Morgan Pryce, said: “I don’t believe the market will get any easier for tenants over the short-mid-term future, especially in the City.
“There is a serious lack of space on the market for tenants looking to acquire office space in the City across all sized floorplates; a 35 percent fall in available space compared with last year tells its own story. This has had a knock-on effect with regards to rental prices. Non-tower, prime city space is now going to be very costly for anyone looking for offices in this location. Later this year around 1.8m sq. ft. is to come on to the market, but this is not going to be sufficient amount to counter the amount of demand that is expected, with a lot of square footage already being eyed up for pre-lets.”
This news was brought to you by Morgan Pryce, a specialist tenant acquisition agent with offices in Oxford Circus and the City. Morgan Pryce specialises in search, negotiation and project management and works exclusively for tenants.