Office take-up in the South East is set to exceed 4m sq ft in 2016, a 21% increase on the 3.3m sq ft five-year average, according to Savills.
As a result, average grade-A headline rents in the Thames Valley are likely to grow by a further 10% to £38 per sq ft.
Increased activity in technology, pharmaceutical and energy sectors has driven the rise.
There has also been an increase in larger lettings and significant prelets on spec builds including Velocity in Weybridge, Point in Maidenhead, and One Forbury Place in Reading.
Savills’ figures to the end of Q3 2015 show deals greater than 30,000 sq ft representing 10% of total take-up, double that of 2014.
Occupier demand in the region is also up, with 768 requirements from companies such as Ernst & Young, Experian and Hyundai at the end of Q3 2015 representing 11.4m sq ft of office space, up 28% on the same period last year. Savills said there is a current total supply of 18.9m sq ft.
Jon Gardiner, head of the South East office agency team at Savills, said: “While it is by no means a return to the highs of the late 1990s, the overall market dynamic between supply and demand is creating a healthy environment for investors and developers to enjoy good levels of leasing and strong rental growth. Moreover, while the trend of central London occupiers decentralising operations is likely to be of greatest benefit to Greater London submarkets like Chiswick and Croydon initially, towns across the South East that are well serviced by infrastructure can also expect to see the benefits going forward.”
