London office space 22nd December 2015

The amount of vacant Central London office space fell further to 4.28% in November as lettings exceeded their long term average, according to BNP Paribas Real Estate research published today.

The global advisor found the proportion of central London office space that was vacant drop from 4.55% in October, while take-up reached 0.62m sq ft, bringing annual levels to 12.4m sq ft and exceeding the long term annual trend of 12m sq ft. The largest deal of the month was Deutsche Bank’s acquisition at Land Securities Zig Zag, SW1, which is now close to 80% let just one month after completion. Interest in upcoming schemes in Victoria is rife; indeed Nova South which is due for completion in Q2 2016 has attracted occupiers Egon Zehnder and Advent International. Furthermore, Pret a Manger is under offer on 30,000 sq ft at Tishman Speyer’s Verde scheme, due to complete in Q3 2016.

Across central London, 2016 completions will total 7.03m sq ft, one fifth of which is already committed. Notable pre-lets at schemes due to complete next year include One New Street Square, EC4, to Deloitte, One Rathbone Square, W1, to Facebook and Three Pancras Square, N1C, to Havas.

Head of central London leasing Dan Bayley said: “The delivery of Grade A product in 2016 will come as a welcome relief to occupiers struggling to find large floor plates in Central London, especially as the vacancy rate continues to contract at pace.” Investment turnover in November reached £1.81bn, bringing the overall volume for 2015 to £15.43bn, surpassing the long term annual average of £13.5bn.

Head of City Investment Richard Garside said: “With approximately £2bn of further deals under offer, the expected December flurry will push year end levels even further above long-term average.”