In the first quarter 2013 we predicted Central London rent would flat line through the year. However it now looks like some less expensive areas are starting to buck the trend.
Rents rise in Waterloo and Southwark
London Office Rent Update: Looking at the Find a London Office Rental Guide, we have increased the rental estimate on quality office space in Waterloo & Southwark from £32.50 per ft2 to £37.50 per ft2. And we have seen brand new space in Valentine Place SE1 being let at £45.00 per ft2!
East London Office Rent to follow suit
In the third quarter, we expect to report Midtown, Clerkenwell and Silicon Roundabout are following suit, as media, fashion, Design and IT based companies migrate east from more expensive areas such as Mayfair, St James’s, Soho and Covent Garden.
And its easy to see why. Sipping a flat white outside Paul, on Kingsway, the once lugubrious Holborn felt more like Covent Garden. And Saatchi have moved their HQ to Chancery Lane!
Clerkenwell and Silicon Roundabout will attract more tenants as Crossrail nears completion. In London’s answer to Southern California, you can hardly get off the tube at Old St Station, the platform is so full. There is a real buzz.
The new Soho
Of course the main reason we see things kicking off a bit further east, is that overall occupational costs are much lower than the West End. We think the postcodes on the northern fringe of the City will become the new Soho.