Along with my latest office market commentary, I am happy to provide our latest rental guide – estimating central London office costs at the end of March 2019.
On the surface, there have not been many changes to quoting office rents. However, as with previous quarters, things are happening if you dig a little deeper.
Developments in the flexible office market
London’s flexible office market is continuing to grow in supply. There has never been such a diverse selection of stock to choose from, with different styles of serviced offices in London catering for every taste.
Inevitably, continued economic uncertainty is having a sustained impact. We are, however, seeing two noticeable changes from office providers in response to current challenges:
- Office providers with vacant space are now incentivising prospective tenants. For instance, some business centres are making deeply discounted offers for the first year in an effort to get “bums on seats” and hold off competition.
- Other providers have improved their offer with extra communal space. Break out areas, focus booths, phone booths, shared working spaces, event space and so forth are all the rage. A greater emphasis on communication, collaboration and more inspiring environments is being made in an attempt to let space in a more competitive office market.
A greater emphasis on communication, collaboration and more inspiring environments is being made in an attempt to let space in a more competitive office market
Longer term leased space options
In the longer term leased office market we are also finding an increase in supply. An existing client, currently looking for office space in Victoria is weighing up 10 to 15 decent alternatives. And yet, when we initially helped them 4.5 years ago they only had 2 options to consider. Of course, added availability puts tenants in a much better negotiating position. And as a result, we have been getting some great deals over the line recently.
The London office market is changing. One of our clients is currently looking for office space in Victoria, weighing up 10 to 15 decent alternatives. When we first helped them 4.5 years ago they only had 2 options to consider.
Something new from Find a London Office
As I mentioned at the start, the headline rents haven’t changed much since Christmas. Like the London office market, however, Find a London Office continues to adapt and evolve. In response to numerous requests, we have provided an option to download our rental guide in both PDF and Excel formats.