Research

Q4 2021 Central London office market report

The Central London office market finished 2021 strongly with investment volumes back to pre-pandemic levels and strong demand for office space despite the ongoing threat of another lockdown.

February 16, 2022
Contributors:
  • Julian Sandbach
  • Rob Corbett
  • Chris Valentine
  • Jeremy Attfield
  • Rob Jackson
  • Elaine Rossall
  • Hayley Armstrong

Q4 saw leasing volumes peak in excess of 2.7m sq. As a result, the full year volumes reached 8.6 million sq ft, 80% ahead of the levels recorded in 2020. The trend for large occupiers to commit to space continued with 12 transactions signed for in excess of 50,000 sq ft.

The TMT sector remained the most active sector of 2021, accounting for 30% of lettings followed by professional services who took 20% share of overall leasing volumes. There were tentative signs that the flexible workplace sector was starting to recover, and leasing activity to the sector increased by more than 200% between 2020 and 2021.

The investment market continued to show signs of improvement with an ever-increasing weight of global capital targeting core assets, and strong competition for the best assets driving price growth. Office investment turnover reached almost £5.3 billion across the quarter, the highest quarterly volume since Q4 2018.

Our issue to watch this quarter also looks at tenant migration trends.

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