The current state of London office leasing – Part 1
A look at office space demand in London.
How are interest rates and lack of developments affecting London office leasing?
Property letting specialists and agents Pearl and Coutts have commented on the state of London’s current levels of office demand. According to the company, firms looking for office space within the UK capital are finding it far too difficult to locate available commercial properties. This is chiefly caused by high interest rates coupled with a lack of available developments.
The problem also spreads to the amount of developments that will be completed in the foreseeable future. There are some signs of improvement however, such as the recently completed office tower 25 Churchill Place in the London Docklands area. However, with the office economy stalling and staying somewhat static companies are beginning to struggle.
West End occupancy currently stands at around 94% and the current occupancy rate has risen at the fastest pace since the end of 2005. Central London however is currently seeing its lowest figures over the past 30 months.
Speaking out concerning the state of the London office market a Pearl and Coutts spokesman commented: “Many businesses are inevitably trying to keep their overheads as low as possible right now, and a great number are opting for premises in alternative parts of London. It’s possible to source commercial property with great transport links, within a smart building, and with suitable on-site facilities without the costs associated with central areas.”