The amount of office space available to rent in central London has plummeted by 14% over the past 12 months, a trend that is expected to push up rents.
Data from Deloitte Real Estate show that the West End’s vacancy rate is just below 4%, its lowest level since 2009.
Deals that took out big chunks of space from the market in 2014, included the Estée Lauder Companies taking 144,000 sq ft office scheme 1 Fitzroy Place, W1.
The City of London market has not seen as dramatic a decline in available space, hovering around 5m sq ft throughout 2014. However, space remains at its lowest level for seven years, despite more than 3m sq ft completing construction last year.
Chris Lewis, head of tenant representation at Deloitte Real Estate, said: “We expect strong occupational demand to remain during 2015 with a limited development pipeline. We anticipate 6.3% rental growth in the City and 8.7% in the West End over the next 12 months on prime Grade A buildings.”
