The supply of office space in Central London is almost 10 million square feet down on its peak two years ago and no speculative developments have started, according to research conducted by Knight Frank.
Investment turnover throughout Central London fell to £2 billion, which is thought to be a result of a lack of available space at the beginning of the year, according to research by a leading commercial property company.
Take up of office space in London rose to 3.2 billion square feet this autumn and the volume of transactions increased in all size brackets. The report went onto say that the availability of office space has continued to fall it and it now stands at 15.9 million square feet which represents a vacancy rate of 7 per cent. This finding is supported by a continued downward turn in speculative construction, which now totals 4.7 million square feet.
The report goes on to give an overview of the three areas that make up central London, the West End,City and the Docklands.
In the City, take-up returned to an average 1.5 million square feet, with availability falling to 9 million square feet, reflecting a seven percent vacancy rate. Whilst prime headline rents remain unchanged at £55 per square foot and investment availability rose to £3.8 million.
In Docklands, office space take-up over the quarter increased to 400,000 square feet and availability rose three per cent to 1.5 million square feet. Prime headline rent in the area remained at £36 per square foot and no investment transactions have taken place so far this year.
Whilst the West End performed well, with an increase in take up to 1.3 million square feet, this represents a fourteen per cent improvement, with availability rising to 5.4 million square feet. Prime headline rents stayed at £92.50 per square feet and investment turnover continued to rise, with the amount now totalling £958 million.