Take up of London office space hit 2,564,000 sq ft across the capital in Q3 according to new data from Colliers.
The third quarter saw 1,179,000 sq ft of transactions take place in the West End; the highest level since Q1 2019 and 13 per cent above the 10 year quarterly average. In the City, take up reached 1,165,000 sq ft in Q3.
The total London figure of 2.56 million sq ft recorded in Q3 compares to 2.02 million sq ft in Q2 and 1.7 million sq ft in Q1. Significantly, there was a 151 per cent rise in take up year-on-year when 1,023,000 sq ft was recorded in Q3 20. Appetite for Grade A space also rose, accounting for more than 60 per cent of transactions compared to the 10-year average of 54 per cent.
Tom Wildash, Co-Head of West End Leasing at Colliers, commented: “The Q3 figures are positive evidence that the London office market is continuing its recovery. We are seeing a significant level of activity from a range of occupiers, both large and small, who are looking to acquire office space that matches the needs of their workforce, be that location, specification or fit out. With a further 3 million sq ft believed to be under offer, we expect to see transaction levels climb and may reach 9 million sq ft by the end of the year; 50 per cent up on 2020.”
Guy Grantham, director in the Research & Forecasting team at Colliers, added: “Occupier activity across the London office market continues to improve steadily as we progress through 2021 and toward a comprehensive return to the office in 2022. Encouragingly for the London economy and property market, 24 per cent of current mandates are derived from need for the occupiers to seek expansion space. While looking at the deals already signed in 2021, 22 per cent of tenants reduced their footprint, however when it comes to the pipeline of requirements, occupiers looking to reduce their space is just 10 per cent, suggesting improving sentiment in the market.”