JLL - Central London office take-up reaches 2.3m sq ft in Q1
According to JLL’s latest office research
Take-up of office space across Central London totaled 2.3m sq ft in the first quarter of 2018, according to JLL. Transactions across the City of London reached 1.3 m sq ft, whilst the West End saw 860,000 sq ft of deals and East London 215,000 sq ft.
Take-up for Central London's office market represented a 14% rise compared to the corresponding quarter of 2017 and a 5% increase on the average Q1 total over the last 10 years, which JLL marked as particularly encouraging given that the first quarter of any year is typically slow.
JLL's research highlighted that all sectors were active in Q1 2018 - the service industry continued to lead, echoing the trend established in 2017 which is mainly attributable to the continued rise in the demand from flexible office providers, accounting for 26% (600,000 sq ft) of space. TMT, professional services and banking and finance all recorded similar levels of take-up, representing 22% (512,000 sq ft), 21% (480,000 sq ft) and 20% (469,000 sq ft) respectively.
Over 28% of the transactions completed in Q1 2018 were undertaken on a pre-let basis, according to JLL, which the agent believes is continuing to erode future supply. This is trend that is expected to define the rest of the year as 44% of the space currently under offer in Central London is either currently under construction or off-plan.
JLL cited that occupier demand remains robust across Central London and currently totals 14.1m sq ft. The banking and finance sector has the largest share of active demand (27%) followed by professional services (22%), service industry (20%) and TMT (19%).
Neil Prime, head of Central London offices at JLL, said: "Given the significant levels of take-up that we saw in the final quarter of 2017 these figures are impressive and suggest that the market retains its attractiveness to occupiers despite the ongoing political disruptions. In addition to a strong first quarter, our research has identified that there is currently 3.5m sq ft of space under offer across Central London, representing the largest amount of space under offer for a decade."