Central London sees rise in office demand: CBRE

Office demand rose by 8% in Central London in the last month with a 13% record increase in the City which saw requirements hit 7.6 million sq ft (706,000 m2), according to the latest research from CB Richard Ellis.

In the West End, demand remained steady at 4.8 million sq ft.

Availability in Central London increased by 2% reaching 13.9 million sq ft in July. There are now 17 units over 100,000 sq ft with the Shard (589,600 sq ft) being the largest and due for completion in the first half of 2012. The largest available unit in the City is Cannon Place with 389,000 sq ft and is scheduled for completion in September.

With just four deals over 20,000 sq ft, take-up in July fell across all markets to reach 658,000 sq ft for Central London as a whole. While deals for newly completed space rose sharply, a fall of nearly 45% in second hand take-up drove overall transactions down. Activity was focused largely in the City and West End where take-up totalled 310,800 sq ft and 227,200 sq ft respectively. Reflecting this, take-up in both the City and West End were marginally lower on a six-month rolling average basis.

'Take-up in Central London was subdued during July as occupiers continued to reflect current economic conditions,' said Digby Flower, head of CBRE's Central London Agency. 'However, a fourth consecutive month that space under offer has remained at or above the ten year average re-affirms our belief that the second half of the year will witness an improved picture on the first half, particularly as we have begun to see the return of the pre-let market.'

The largest deal in July saw Expedia move from the West End to the City where they acquired 81,300 sq ft at the Angel Building, EC1. Facebook took 36,400 sq ft of Expedia's vacated space in the West End at Seven Dials Warehouse, WC2.