Activity was particularly strong in the West End, where 2002 was a record year for office investment with £2.24 billion ($3.6 billion) of deals, up from £2.1 billion ($3.3 billion) in 2001.
The IRE survey also showed that occupation trends are brighter in the West End market. Take up improved from 489,000 sf in the third quarter to 870,000 sf in the final quarter. And availability fell from 6.48 million sf to 6.23 million sf. In contrast availability in the City rose from from 7.77 million sf in quarter three to 9.20 million sf in quarter four, with take up falling from 1.41 million sf to 305,000 sf.
Insignia says average rents have now fallen 10-12% in the West End; 15-17% in the City and 20% in Midtown over the past 12 months. Peter Damesick, Head of Research at Insignia Richard Ellis said: "Rental adjustments in the West End market appear to be encouraging more occupier activity but the situation in the City is as we anticipated, reflecting the difficulties being experienced in the financial services sector."
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