Central London office analysis
DATA & ANALYSIS
OCCUPIER MARKET IN BRIEF
First, the good news: despite the subdued activity levels this quarter we are seeing a number of large occupiers continuing to commit long term to London. Baker McKenzie took 153,000 sq ft at DUO, 280 Bishopsgate, EC2 that will complete in late 2021 while The Office Group signed a 20 year lease for the entire building at 210 Euston Road, NW1.
In addition, the demand we are still seeing is coming from a diverse range of occupiers across central London.
INVESTMENT MARKET IN BRIEF
Investment activity was markedly improved in Q3 2020 compared to the previous quarter, both in terms of volume and number of deals. Volumes increased to £1.2 billion from £682 million in Q2 but remained 67% down on the 10-year quarterly average. The relaxation of some restrictions during the summer provided only partial relief to investors with restrictions on travel, reignited Brexit negotiations and a typical summer lull continuing to have an impact. Furthermore, The RICS only lifted their Material Uncertainty Clause in July.
Central London Occupier market
Take-up across Central London fell to 1.0 million sq ft in Q3 2020 which was 7% below the previous quarter and 59% below the 10-year average.
The largest deal of the quarter was the law firm Baker & McKenzie taking 153,000 sq ft at 280 Bishopsgate, EC2. This was followed by Netflix trebling its office space in London by taking 87,000 sq ft at the Copyright office building, 30 Berners Street, W1.
Central London Investment market
Investment volumes reached £1.2 billion in Q3 2020, 67% down on the 10-year quarterly average. Despite being below average, Q3 investment was considerably higher than the previous quarter, when just £682 million was transacted. At the end of Q3 2020, investment YTD totalled £4.2 billion, 39% and 69% down on the same period in 2019 and 2018 respectively.
This report has been prepared by Avison Young for general information purposes only. Whilst Avison Young endeavours to ensure that the information in this report is correct it does not warrant completeness or accuracy. You should not rely on it without seeking professional advice. Avison Young assumes no responsibility for errors or omissions in this publication or other documents which are referenced by or linked to this report. To the maximum extent permitted by law and without limitation Avison Young excludes all representations, warranties and conditions relating to this report and the use of this report. All intellectual property rights are reserved and prior written permission is required from Avison Young to reproduce material contained in this report.