Central London office take-up boomed in 2018, as lettings reached 14.6m square feet. New research from Knight Frank, shows that this is 14% higher than the long-term average, and the highest level since 2014.
Overall, London office take-up was 5% higher than the previous year, which stood at 13.48m square feet. The fourth quarter of 2018 totalled 3.82m square feet, slightly surpassing the third quarter of 3.74m square feet.
Property agents are forecasting that this boom in London’s letting activity is likely to carry on into 2019, as supply shortages and persistent levels of demand suggest that there is little sign of slowdown in take-up levels.
During 2018, the capitals creative industry showed the strongest appetite for office take-up. Technology, media and telecommunications firms accounted for nearly 30% of all take-up, followed by finance with 19%.
William Beardmore-Gray from Knight Frank said: “We’ve had a perfect market for the last 12 to 18 months”.
“Will it continue? I think if we have some resolution which is short of a hard Brexit, then we will see the market continue to move in the way that is has done.”
He further added: “We are seeing no let up in the expansionary nature of demand across almost all sectors… the tech sector has continued to move forward very strongly.”
Meanwhile, new data from investment management company JLL, also found that the commercial office take-up within the capital has reached its highest level in three years, as letting activity in the Square Mile hitting 6.5m square foot in the last 12 months.
Elaine Rossall, JLL’s head of UK offices research said: “The levels of confidence are being shown through the volumes of pre-letting that we are seeing – lots of occupiers committing to space 12 to 18 months ahead of completions.”
She adds: “In banking and financial services we would have expected it to be quiet in the last two years, but we’ve seen significant activity in that sector, along with the likes of Google and Facebook taking more and more space too”.
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