Key European markets see office take-up slide to 3-year low: CBRE

Net take-up in key Western European markets dropped to around two million m² in the first quarter of 2012 as economic woes in the eurozone and the uncertain outlook continued to affect occupier demand and constrain leasing activity, according to CBRE's EMEA Research Study on the office sector. The take-up figures reflect a decrease of 22% quarter-on-quarter and 9% year-on-year, the lowest quarterly total since 2009, the property adviser said.

Across Europe, leasing activity remains primarily driven by lease breaks and expiries and companies’ desire to reduce occupancy costs and optimise the use of space.

CBRE said new completions are now at their lowest level in many cities, however the weakness of demand and continued release of space by occupiers are hampering a faster reduction in vacancy rates.

With the level of new supply falling, the quality of available space also continues to deteriorate. This is restricting occupier choice of large, good quality units, especially in central areas. By contrast, supply of second-hand space is rising in many markets, and when the building is also outside the main office areas, an even lower rent is often insufficient to generate enough interest from occupiers.