LONDON-Central London offices are seeing a strong recovery in demand, according to Cushman & Wakefield Healey & Baker. Take-up has been faster in the West End, but the city has also seen strong demand particularly from law firms. That segment alone accounted for 28% of space taken. But C&W/H&B believes there are unlikely to be large financial requirements in the short term because there is still so much surplus space.

Across Central London take-up increased 29% to 1.9 million sf, the highest quarterly total since the third quarter of 2002. The City of London core sub-market reported the highest take-up of office space since the first quarter of 2001 with 746,458 sf. Across the city as a whole, take-up reached 1.3 million feet, an increase of 40% over the first quarter of the year.

In both markets, there is a gap in demand for middle-range space as occupiers take advantage of historically low rents for new stock. C&W/H&B predicts that, until supply shrinks to levels that necessitate interest in the middle ground, it will not be possible to talk of a Central London recovery.

“There is now clearly an uplift in the Central London market,” says Guy Taylor, head of West End agency. “The pace is faster in the West End than in the city with some record rents set in Mayfair and St. James. The market at the cheaper end has been dominated by the public sector and at the prime upper end by sectors such as finance.”

Although supply continued to increase in the city to 19 million sf, up from 18 million in Q1 2004, the current pipeline of 2.3 million feet under construction is the lowest level on record. The figures mean this year marks the end of the current development cycle with only 181,000 sf of new space due to be completed in 2005.

Take-up activity in the West End also remained strong as occupiers regained confidence in the market, despite the release of the Lyons Report, which recommended the relocation of civil servants outside of London. Demand from the public and government sector actually increased from 918,000 sf to 1.3 million feet in the second quarter, making up 24% of all space taken.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.



Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join now!

  • Free unlimited access to's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including and

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.