Central London office market expected to see 8.5m sq ft of space transacted in 2021
JLL reports that a further 2.8m sq ft is currently under offer across Central London
Following sustained levels of leasing activity throughout the year, JLL has calculated that over 7.4m sq ft of office space in Central London has been transacted so far in 2021.
JLL’s latest research has also highlighted that around 2.8m sq ft of office space is currently under offer across Central London and that take-up is on track to reach 8.5m sq ft at year-end. This figure is considerably ahead of the 4.7m sq ft of space that was leased in 2020, and whilst this is still below the 10-year average take-up of 9.9m sq ft it does reflect a significant recovery for the London office market.
JLL reported that the City office market has seen 3.9m sq ft of transactions so far in 2021, with the final take-up for the year expected to reach 4.5m sq ft. Over 3.3m sq ft of space has been transacted in the West End to date and JLL has predicted that this is set to reach 3.8m sq ft by the year-end.
JLL cited that throughout 2021, the tech sector has been most active across the central London office market, accounting for 26% of all transactions. Significant tech sector acquisitions include those by Facebook, IBM, Inmarsat, Apple, TikTok, Snapchat, Gamesys and ITV.
Looking ahead to 2022, JLL has identified 8.5m sq ft of active demand for new office space across central London demonstrating occupiers long-term commitment to both London and the new workplaces for their people.
Jeremy Attfield, Head of City Office at JLL, said: “The City leasing market has not only seen a recovery but also a considerable uplift in transactional activity compared to 2020. There have been a number of significant pre-lets, especially in the legal sector, and we suggest this pre-letting market will continue to thrive throughout 2022. Occupiers are focused on aligning their real estate portfolios with their ESG commitments and this will translate into increased demand for the best space to meet their sustainability, health and well-being targets.”
Chris Valentine, Head of Central London Agency at JLL, added: “Whilst take-up has rebounded strongly across Central London in 2021, the West End market has seen a faster recovery than the City and leasing volumes are set to exceed the 10-year average this year. London’s global importance as an office location, combined with its broad sector mix of occupiers, has underpinned its strong recovery and as we look to 2022, we continue to see new requirements launched as businesses remain committed to long-term strategic work-place plans that focus on the acquisition of best-in-class space.”
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.6 billion in 2020, operations in over 80 countries and a global workforce of more than 95,000 as of September 30, 2021. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.