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LONDON-New research from Insignia Richard Ellis highlights the depth of the problems facing the Thames Valley office market to the west of London. Office take-up in the market, which includes the major office centres of Slough; Reading; Bracknell; Basingstoke and Newbury reached just 1.2 million sf in the first half of 2002, down 50% on the same period a year previously. According to IRE this is one of the lowest levels of activity ever seen in the market.

The broker attributes the slowdown to the continuing problems in the telecoms and IT sectors, which dominate the Thames Valley market. Nevertheless, IT and telecoms companies still accounted for 30% of all activity in the area during the first half of the year.

Availability rose to 11.7 million sf, the highest level of availability seen for 12 years but the flow of space onto the market is easing compared with last year. Ready to occupy offices now equal 10% of all Thames Valley stock.

Against such a depressed backdrop it is inevitable that rents will fall, and IRE says that rents have declined further after falls of 3 to 4% during 2001. IRE puts prime Maidenhead rents at £32 ($50) per sf with Slough at £30 ($47); Bracknell at £28 ($43); Reading at £27 ($42) and Basingstoke at £20 ($31) per sf.

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