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​West London & Thames Valley - strong fundamentals result in growth

Our annual West London and Thames Valley office seminar took place on Wednesday 12 September, 2018. The seminar highlighted the strength of the region's office market in the midst of political and economic uncertainty, underlining its attractiveness for both investors and occupiers drawing on the following key conclusions:

  • The Western Corridor is relatively insulated from Brexit uncertainty 
  • Customer relationships need to be a key focus for landlords as flexibility increases
  • Investment is mainly focused on prime and core assets in strong locations 
  • Development is critical as the pipeline is running dry  
  • Q4 will see measured investment with income-led deals being the key theme

We released the Western Corridor Office Market Report H1 2018 at the event. The key takeaways are: 


  • Office investment in the region for 2018 is expected to reach £2 billion. Overseas investors have accounted for over 22% of these deals to date, whilst local authorities have 34% of the regions transactions so far. 

  • Investors continue to focus on prime/core assets, seeking steady and predictable income streams. However, the availability of suitable product remains low and motivated sellers remain in short supply.

  • The office leasing market has performed at a steady rate and is set to hit 2.1 million sq ft of take-up by year end.

  • Occupiers are increasingly focussed on well located, good quality space, and this has resulted in a decline in the size of transactions. In H1, just over 70% of deals were below 20,000 sq ft as tenants looked for quality space rather than quantity.

  • Flexible space is now a key consideration for both landlords and occupiers –over the past 12-18 months leasing activity from service operators has risen significantly. In H1 2018 alone, there has already been 175,000 sq ft of flexible space leased, representing 18% of total take up, with the majority of space transacted in the Thames Valley.

  • As the number of new schemes commencing declines, there is a supply gap emerging, with the pipeline in 2019 and 2020 looking limited.

  • The Thames Valley is at the heart of the developing battery technology sector in the UK. With the growth of electric vehicles, powering these new vehicles will require new and innovative battery technology.


Speakers

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Angus Minford

Director – National Investment
+44 (0)20 7087 5350
angus.minford@eu.jll.com

 James-Finnis-JLL-sml.jpg            

James Finnis

Director - South East Office Agency
+44 (0)20 8283 2534
james.finnis@eu.jll.com

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Jon Neale

Head of UK Research 
+44 (0)207 087 5508
jon.neale@eu.jll.com

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Laura Houghton

Associate Director – National Investment
+44 (0)20 7852 4959
laura.houghton@eu.jll.com