Tech and media companies have dominated City take-up so far in 2017, accounting for 20% of new deals.
Savills research has shown a total of 517,069 sq ft has been committed by TMT occupiers – the largest amount of take-up ever recorded for the sector in the first five months of a year. Their 20% share compares with 17% for professional services, 17% for insurance companies and 14% for financial services.
The City vacancy rate stands at 5.4%, up on the same point last year by 90 basis points, but still down on the 10-year average of 6.7%, says Savills. The average grade A rent for 2017 so far in the City core is £61.90 per sq ft, and in the City fringe it is £59.17 per sq ft.
Key deals completed in the City recently include visual effects company Industrial Light & Magic (owned by the Walt Disney Corporation) taking 47,010 sq ft at Blackstone’s Lacon House, WC1.
City take-up was 292,764 in May, with 12-month rolling take-up at 5.9m sq ft, up 19% on the long-term average.
Philip Pearce, head of the central London leasing team at Savills, said: “TMT occupiers were out of the blocks quickly this year as the sector continued to grow: snapping up space primarily on the City fringe, which offers both the type of space these companies tend to favour plus slightly lower rents than those found in the City core.
“But it’s not just all about tech. Total City take up for the year to date is up on the same point last year as occupiers from an array of different industries continue to be attracted by London’s unsurpassed position as a global financial and professional hub.”
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