Take-up in the M25 office market has dipped, but stronger activity is forecast for the rest of 2012.
The three months to 31 March saw take-up of 636,074 sq ft, which is around 55% below the 10-year quarterly average, according to Colliers International’s latest South East offices snapshot report.
However, owing to a lack of new space coming to the market, vacancy fell in the first quarter, and this has led to rental rises in areas such as Chiswick and Richmond.
The agent added that there was more than 200,000 sq ft of properties under offer in the region.
Philip Papenfus, head of South East offices at Colliers, said: “There are also significant levels of break clauses and lease expiries coming through over the next 18-24 months, instigated by the peak in M25 demand in 1989, where 25-year leases were signed as the norm.
“As a result, there is a healthy potential for occupiers to upgrade from their existing accommodation, creating ready-made demand for grade-A and refurbished product.”
joanna.bourke@estatesgazette.com
