Office development in London has doubled in the last six months, according to Deloitte Real Estate’s London Office Crane Survey.
The company said 22 new schemes totalling 2.1m sqft had been started in the six months to September.
More than 1m sqft was started in London’s City district, as well as more than 500,000sqft in tech city.
Steve Johns, head of City leasing at Deloitte Real Estate, said the sharpest rise in construction starts was in the City of London, where 10 new office buildings are underway.
The West End, he added, has also seen 10 new starts, adding 462,000sqft to the development pipeline.
With more than 5m sqft being demolished, developers are “racing against the clock” to deliver buildings, Johns said.
Total office space construction in central London is down to 7.7m sqft, below the long-run average delivery of around 10m sqft, partly due to 3.7 sqft of office space completing since the last survey.
Johns said office construction was down 17% over the last six months.
The firm, however, recorded 3.7m sqft of completions over the last six months – a 10-year high.
“To put that into context, a third of this space is within two City towers, with the remaining space across 22 central London buildings,” Johns said.
With 58% of this space leased before completion, London is enjoying “strength of occupier demand”, Johns added.
Of the total 7.7m sqft of space under construction, 41% is already let.
“Despite a healthy pipeline of activity, 2015 is likely to deliver the lowest volumes of space in 20 years,” Johns predicted.
“With occupier demand expected to remain strong, we foresee further increases in pre-letting activity, and demand for the best space to exceed new supply for the next three years.”
