Q3 2022 Central London office market report

Q3 leasing volumes reached 2.4 million sq ft, which was 6% below the previous quarter but the fifth consecutive quarter of excess of 2.0 million sq ft of activity. As a result, YTD leasing volumes reached 7.5 million sq ft, which was 30% ahead of the corresponding period in 2021.

Total space under offer increased to 3.0 million sq ft and is 14% ahead of the 10-year quarterly average. Occupiers continued to focus on best-in-class product, with 41% of total space under offer being for pre-let stock and a further 31% for newly built/refurbished units.

The total vacancy rate increased to 8.1%, mainly driven by an increase in the East London market and remained above the long-term average of 5.3%. New build supply continued to fall standing at 1.3% at the end of September. This remained above the 10-year quarterly average of 1.1%.

Investment volumes reached £3.2 billion in Q3, a 16% increase on second quarter volumes but remaining below the 10-year quarterly average of £3.8 billion. This brought YTD investment turnover to £11.2 billion, which was up 41% on the equivalent period last year (£8.0 billion).