Office vacancy rates in central London near 10-year average

Central London’s office vacancy rates are creeping down towards the 10-year average of 7% following a strong Q2, according to analysis by Avison Young. It puts Q2 office uptake at 2.3m sq ft, with vacancy rates down 0.3 percentage points to 7.1% compared to a 10-year average of 7%. Financial services accounted for almost a quarter (24.2%) of all Q2 uptake, with technology, media and telecommunications on 21.7%, and local government at 8.9%. The sharpest increase by region came in Midtown, which was up 180% on Q2 2023 at 183,000 sq ft. This compares to a 10-year average of 166,000 sq ft. Significant Q2 deals across central London included Citadel signing for 252,000 sq ft at 2-3 Finsbury Avenue, EC2, and Amazon leasing 108,000 sq ft at 8 Curtain Road and 72,000 sq ft at 30 Curtain Road, also EC2. The investment market remained cautious in Q2, according to the analysis, although there was an injection of £522m from European funds. These included Luxembourg-based LetterOne buying 20 Grafton Street, W1, for £100m in April, as well as Anglo-German Feldberg Capital acquiring 21-25 Bedford Street, WC2, for £75m in May.  Avison Young London markets managing director Dominic Amey said: “London is certainly presenting a mixed picture right now, but we do sense a general air of optimism when it comes to investors and occupiers.  “While take up across London as a whole is still below long-term average, it’s good to see general vacancy rates coming down slightly, and some very positive leasing activity in London’s Tech Belt and Midtown. “When it comes to investment, the market is still generally quite cautious and selective, but at last the wheels appear to have started turning, and this points to a much more active H2.” See London lettings information >>  Image © City of London Corporation