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LONDON-Office vacancies in central London rose sharply in the third quarter of 2002, with availability soaring by 14% to 21 million sf. Availability in Central London now stands at 10.4% of stock, double the level recorded a year ago. And at the same time take-up is slowing, with 2.6 million sf absorbed over the quarter, down from 4.3 million sf over the previous three months.

As a result, prime rents have continued to slide to £57.50 ($90) per sf in the City and £67.50 ($105) West End. And DTZ is warning that headline rents will continue to come under pressure over the next few months, coupled with a further increase in the value of inducements.

Jonathan Evans, Head of West End Agency at DTZ, said: “The picture for the immediate future still remains uncertain, with signs that occupiers that do not have to move immediately are delaying, and landlords are becoming increasingly keen to agree lease renewals at very competitive rates.

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