Investment in South East offices hit £619m in Q3, 37% above the five-year average, according to research from Knight Frank.
Demand during the quarter was 6.7m sq ft, a 16% increase on Q2, and the highest level recorded since Q2 2008.
TMT was the most active sector, with 1.4m sq ft of demand.
However, take-up of M25 offices was subdued, at 418,000 sq ft – 22% below the five-year average. The M4 corridor fared better, with 410,000 sq ft of take-up, in line with the five-year average.
The vacancy rate in the M25 hit a 12-year low of 6.4%, while the M4 recorded an all-time low of 7.5% vacancy.
The largest transaction during the period was Oaktree & Patrizia’s £160m purchase of Chineham Park, Basingstoke from MEPC. Other notable deals include Aerium’s £61.5m purchase of Dukes Court, Woking (pictured) from IMV Immobilien and Tesco Pension Fund’s £39.0m purchase of Market House, Maidenhead, from Gatehouse.
Tim Smither, partner at Knight Frank, said: “As anticipated, Q3 was a busier than normal summer period and all signs point towards a flurry of activity during Q4. Buyers are keen to spend before the year end and this will be assisted by increasing levels of stock becoming available, as a number of vendors sense an opportune time to exit”.
sophia.furber@estatesgazette.com
