London’s office markets are remaining strong despite the recent financial turmoil, a report by Midtown specialists EA Shaw has revealed.
The Q3 London office report found that, though vacancy levels have edged up, they are still very low and are putting upward pressure on rent values.
EA Shaw head of commercial Charlie Killen said: ‘It is still a little too early to comment on the true effect the jittering financial markets will have on the London occupier market.
‘Our core markets are still witnessing improvements this quarter with low levels of supply and solid demand resulting in continued increased rents – something likely to carry on into early next year.’
EA Shaw quotes vacancy levels in WC1, between High Holborn and Kings Cross, at 1%. WC2, between the river Thames and High Holborn, and Soho both have a 2.4% vacancy level. The upward pressure has led to rents touching £75/sq ft in Midtown and achieving £67.50/sq ft for the best space in Soho’s Golden Square.
On the South Bank, availability has risen to 5.8% from 4% in Q2 but EA Shaw says the space is largely second hand and on short-term lets, meaning letting activity remains high.
The report also points to increased refurbishment activity, feeding supply into mid 2009, as a sign of continued strength in the London office market.