London office update 18th October 2012

Total take up of office space in London rose 6.3% in Q3 2012.

Total take up of space within London in Q3 2012 rose 6.3% compared to Q2 2012, according to new research by BNP Paribas Real Estate, the leading property adviser.

The research also revealed that total supply of space within London was stable in the third quarter, only rising by 2.2% compared to the same period last year.

Meanwhile, prime rents stayed static across all London-sub markets, with £100 per sq ft being achieved in the West End, £54.50 per sq ft being achieved in The City, £52.50 per sq ft being achieved in Midtown and £37.50 per sq ft being achieved in the Docklands.

Interestingly, investment into the West End office market rose 30% to £950 million in Q3, compared to £730 million in the second quarter of 2012.

Elsewhere, investment fell, with a 42% drop in The City and a 15% drop in Midtown. During Q3, no investments were made into the Docklands market.

Dan Bayley, MD of Central London at BNP Paribas Real Estate, commented: "Whilst Q3 take-up was not spectacular, there are some major deals under offer which should deliver a strong last quarter across Central London."

Paul Henwood of BNP Paribas Real Estate's investment team added: "The West End investment market benefited from increased stock levels compared to previous quarters, as well improved interest from overseas investors. Conversely, Midtown investment transactions were very limited, as the market is seen as growth stock.

In addition, The City saw limited new stock offerings due to the summer slowdown and of course, the Olympics." "Looking ahead, City investment trading figures are likely to improve in the final quarter of 2012, as we witnessed an influx of new investment sales in September, although there are some early concerns over rental performance," concluded Henwood.