Increase in office occupancy leads to new office developments
A report by Cushman & Wakefield showed that 3.1million square feet of London office space has been rented in 2010, a figure 330% higher than in the same period in 2009.
Figures show that the West End, City and Docklands have had a significant growth in occupancy for the beginning of this year, perhaps because companies have decided to relocate to new offices to take advantage of low rental prices.
Cushman & Wakefield, real estate experts, have suggested that this growth could encourage developers to construct new buildings to meet the growing demand for office space.
James Young, head of Cushman & Wakefield’s City office, said, “The first quarter of the year has seen a number of larger occupiers taking a long term decision on their future HQs.”
“And a lack of development activity now means that rents are rising as availability drops.”
Within the City and Docklands over 2.1 million sq-ft of office space was leased at the beginning of the year, which is 5 times more than in the same period of 2009.
George Roberts, head of London occupiers, Cushman & Wakefield, said, “Whilst one shouldn’t read too much into one quarter’s figures, there is no doubt that the underlying market feels much more positive than at the end of the year with increased levels of activity.”
These increased occupancy figures, which are equivalent to leasing the ‘Gherkin’ building out four times, mean that there is a definite demand for new office space.