City take up rises 15th May 2017

Take up in the City of London hit 1.4m sq ft (137,999 sq m) in the first quarter of 2017, 18% above the long term average, according to Savills.

Demand was marginally higher in City fringe locations, which saw 785,924 sq ft (73,012 sq m) taken in Q1, compared to 702,564 sq ft (65,268 sq m) in the City core.

According to Savills, 12-month rolling take up stood at 5.7m sq ft (529,530 sq m) as of the end of March 2017, up 14% on the long term average.

The professional services sector has accounted for the greatest proportion of take-up in the year-to-date, says Savills, at 24%. This is followed by retail and leisure at 17%, tech and media at 16% and insurance and financial services at 7%.

Total City supply stood at 6.9m sq ft (641,010 sq m) at the end of March, equating to a vacancy rate of 5.5%. This is up on the same point last year by 110 basis points (bps), says Savills, however it is also still down on the 10-year average by 110bps.

Key deals to complete in the City in March included Expedia expanding into a further 136,657 sq ft (12,695 sq m) at the Angel Building, EC1, after Cancer Research announced its desire to vacate, and Amazon committing to its remaining space option at Principal Place, E1. The online retail giant now has an additional 89,343 sq ft (8,299 sq m) across the first four floors of the building.

Philip Pearce, head of the Central London leasing team at Savills, comments: “At the end of the first quarter of 2017 the City market is in robust shape: take up is above average, the vacancy rate remains low and rents are largely stable. Looking forward we see continued demand across all London locations.”