In the latest promising sign that the UK property market is on the road to recovery, Cushman & Wakefield have reported that London rents have risen for the first time in 3 years.
According to Bloomberg, rents for the most expensive office areas in London rose by 3.5% to £44 per square foot in the last quarter of 2009. Tenants signed leases for 2.6 million square feet in the entire London office market in the three months from September from December. That’s the largest amount of new leases since the collapse of the Lehman Brothers in September 2008.
Rents have fallen for the last 2 consecutive years since the economic downturn struck. Prices sank to around £42 per square foot in 2009, down from a high of £65 per square foot in mid 2007.
Major City lease agreements in the last 3 months include Clyde & Co who took 145,000 square feet at Minerva’s St Botolph’s development and Pinsent Masons who took on 189,000 square feet at Crown Place.
“This first sign of rental growth going into 2010 provides a boost for landlords and developers and means tenants have a narrowing window of opportunity to secure space at some of the lowest prime rents in a decade,” Cushman & Wakefield said.
That’s good news and I hear the same is happening in the residential market too. Demand is high for rental property. However, in our office block in North London half the offices are empty and they are giving away half price rent for 6 months. But I guess the high end of the market is a different story.
Comment by Virtual Office — January 12, 2010 @ 12:39 pm