Prime rental values in London’s Mayfair and St James’s have fallen by almost a quarter over the past year.
Research by Cluttons shows that values have tumbled from a high point of £86 per sq ft (£925 per sq m) in January 2001 to £65 per sq ft (£699 per sq m) in January 2002.
The figures also show that office availability in Mayfair has risen by 45% over the past three months to 661,426 sq ft (61,446 sq m), while take up has fallen by 44% to 80,000 sq ft (7,432 sq m).
Availability in St James’s has remained stable over the same period, while take up has risen by around 20,000 sq ft (1,858 sq m).
Over half of the vacant grade A space, which in St James’s accounts for 79% of the total, is attributed to Grosvenor’s 100,000 sq ft (9,290 sq m) Almack House, SW1, and Haslemere’s 60,000 sq ft (5,574 sq m) Kincaird House, SW1.
The research also shows that Mayfair’s development pipeline has 292,899 sq ft (27,210 sq m) at application stage and 372,875 sq ft (37,640 sq m) with planning consent and a further 356,000 sq ft (33,072 sq m) under construction, of which under 10,000 sq ft (929 sq m) is prelet. At the present rate of take up the supply would last just three years.
In St James’s, there is 662,433 sq ft (61,540 sq m) of new office space with consent, and a further 229,537 sq ft (21,324 sq m) under construction.
However, Melanie Bayliff, Cluttons’ central London research analyst, believes that supply in St James’s will be even more constrained than in Mayfair, “There are currently no outstanding planning applications,” she said.
EGi News 18/03/02
