A strong office lettings performance in Noho and Covent Garden has contributed to the West End office vacancy rate shrinking to 3.7%.
West End office take-up in Q4 jumped 60% to 822,369 sq ft from the previous quarter, bolstered by a number of deals in Covent Garden and surrounding areas, according to Cluttons’ latest West End office update.
Rents have remained static at £95 per sq ft, and top prime rents at £105 per sq ft. But Cluttons said that in the “cool crescent”, comprising Noho, Marylebone, Soho and Covent Garden, rents have risen by around 5%.
The company said: “This is generating greater uniformity in pricing across the West End quality fringe sub-markets. The limited number of occupiers in the market have quickly absorbed the available supply in this ‘cool crescent’, which is perceived to offer value in a difficult economic climate.”
Deals include Zebedee Capital taking 3,311 sq ft at 24-27 Great Pulteney Street, W1, paying £90 per sq ft.
Total West End availability stands at 2.27m sq ft – a 25% drop on the previous quarter. The increase in lettings activity has led to the vacancy rate falling to 3.7%, which is the lowest figure since May 2008.
However, investment volumes dropped in Q4 to £535m, a 56% fall on the same period in 2010.
joanna.bourke@estatesgazette.com
