The pharmaceutical sector accounted for almost a quarter of office take-up in the South East last year, according to Cushman & Wakefield.
Annual take-up was 5.8m sq ft in 2015, a 26% rise from 2014, with pharmaceutical companies taking 1.4m sq ft, or 24% of all deals.
The region’s biggest deal in 2015 was AstraZeneca’s acquisition of 850,000 sq ft at the Cambridge Biomedical Campus.
An increase in preletting activity meant grade-A take-up also rose, with 11 deals of more than 50,000 sq ft, compared with six in 2014.
Availability fell by 16% in the region last year, with the South M25 market experiencing the biggest decline owing to a combination of improved take-up and a limited development pipeline.
Cushman & Wakefield predicts prime headline rents in the South East will rise by an average of 25% over the next five years.
Reading and Maidenhead are forecast to see increases of 38% and 33% respectively, which will take average rents to £47 per sq ft and £44 per sq ft.
Charles Dady, Cushman & Wakefield’s head of South East office agency and UK landlord services, said: “Occupier activity will continue to increase across the South East during 2016 due to improving indigenous demand and the escalation of costs in central London. We expect this will trigger the decentralisation of a greater number of business functions and jobs from the capital to more affordable locations.
“With the pipeline of grade-A office space constrained, headline rents have now reached or exceeded their previous peak in most submarkets. This trend is likely to continue through 2016, with prime levels approaching £40 per sq ft for the first time outside greater London.”
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