The latest goings-on from across the Central London office market
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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Catch up on our Q4 breakfast webinar by clicking the link above when we ran through the latest market stats, recent activity and market sentiment. We also answered your questions and provided our thoughts and outlook for the year ahead. To read our full Q4 market report, click here.
London’s urban economy and its office market have been among the most dynamic in the world in recent decades. But the Covid-19 pandemic presents unprecedented and material challenges for both. This paper examines the longer-term trends before returning to the question of how the market navigates the immediate challenges.
Sustainability was and still will be a long-term priority for many businesses. The pandemic has nevertheless brought a number of sustainability issues to the fore and as we emerge from the crisis, we fully expect companies to prioritise sustainability as part of their strategy for recovery. This includes accelerated action on transition to net zero and this report provides useful evidence to build a robust business case for investing in sustainability.