In Knight Frank’s recently released Central London Quarterly Report, it said that vacancy rates in Central London offices has hit a 14 year all time low, with expectations of an historic low occurring in the next two years.
The report shows that the West End was one of the biggest contenders, with vacancy levels at its lowest since 1989 at 3.4 per cent.
Head of Commercial Research at Knight Frank, James Roberts, commented: “The supply situation in central London is now very tight- at a fourteen year low for the capital as a whole.”
He went on to say: “This is moving the market firmly in the landlord’s favour, and tenants are discovering when their leases come up for renewal that they are facing significant rent hikes.
“Consequently, more firms are choosing to be open-minded on location, and are looking at offices in up-and-coming areas, whether it is King’s Cross, Aldgate, Shoreditch or Soutbank.
“Effectively, it is an office market equivalent of what happened in the housing market in the 1980s when young professionals began moving into places like Lambeth and Clapham, and gentrified those areas.”
Also mentioned in the report was office availability in Central London, which is down by 29 per cent since last year, with 10.3 million sq ft available.
Vacancy rate for central was also down by 4.4 per cent from a year ago where it was at 6.2 per cent. While City vacancy rate at 5.1 per cent, down from 7.3 per cent last year.
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