The Central London office market saw take-up levels rise well above trend in the third quarter of 2010, according to a new research report from CB Richard Ellis. The market saw the return of large pre-letting deals, which boosted take-up to 325,000 m2, 27% above the previous quarter, and an increase of 12% above the long-term average.

The Central London office market saw take-up levels rise well above trend in the third quarter of 2010, according to a new research report from CB Richard Ellis. The market saw the return of large pre-letting deals, which boosted take-up to 325,000 m2, 27% above the previous quarter, and an increase of 12% above the long-term average.

Supply was squeezed to 1.4 million m2 at the end of Q3, fuelled by large falls in the availability of second-hand space and led to a sharp increase in prime rents in the City and Midtown markets. Availability across the market as a whole is now nearly 557,000 m2 lower than in the most recent peak at the end of Q2 2009.

According to the CB Richard Ellis prime rent index, annual rental growth in the City was 19.2% , the largest of any Central London market. The West End grew by 8.5% in the same period, and the Docklands by 4.2%.

With only 10% of the 370,000 m2 of completions to be delivered during the last quarter of the year, there is little sign of supply problems easing, and a rapidly diminishing completion rate of 1.6m sq ft is expected in 2011 and 2012, CBRE said.