Central London
office market

The latest goings-on from across the Central London office market

Julian Sandbach

Head of Central London Markets

The future of office demand: Central London after Covid-19

“The central London office investment market could become more polarised over the next year and beyond, with a widening spread between a more narrowly defined core and a larger set of value-add opportunities. Core properties will generally be those let on longer leases to corporates, with 'state of the art' fit-out and sustainability and health and wellbeing credentials, all aimed at propagating brand values and attracting staff. Given London's relatively high yields, and falling returns in other asset classes, particularly fixed-income, demand for the relatively limited pool of core properties in London and other gateway cities could increase.
“Beyond this core category, much of the rest of the market can be considered to be 'value-add' as assets are reorientated for a more flexible future. Investors will have to accept a greater degree of fit-out provision, management, curation and service provision than in the past, as multi-let and flexible leases become the norm.”

 

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