Demand for London offices unphased by remote work and downward economic trends
Demand for office space in central London has held firm despite the ongoing work-from-home trend and economic downturn risking upending the capital’s market.
Uptake of central London offices surged 63 per cent in the first nine months of this year, in comparison with 2021, according to data shared exclusively with City PM today by BNP Paribas Real Estate.
The British capital was home to the second highest spike in take-up in Europe, behind only Dublin.
“While this trend is evident throughout key cities in Europe, it’s no surprise that demand in London has seen such a sharp recovery,” James Strevens, head of City leasing at BNP Paribas Real Estate said.
“As one of Europe’s largest urban economies, it remains hugely competitive on the world stage, attracting occupiers to its highly skilled talent pool, leading legal and regulatory systems, and influence over culture and arts.”
It is the latest sign that the uptick in remote working has failed to kill off office life, with the vacancy rate in central London standing at less than nine per cent at the end of the third quarter.
Vacancy rates in the Square Mile stand slightly higher at 11.4 per cent.
But the so-called ‘flight to quality’ holds true among some of the biggest lettings firms in London, including GPE, which most recently facilitated law firm Clifford Chance’s shift from Canary Wharf to the City.
Ben Thomson, head of tenant representation at BNP Paribas Real estate, added: “Despite the hybrid working revolution, and some occupier consolidation, overall demand for office space has been incredibly robust this year.
“Occupiers are clear in what they want in a post Covid-19 world: amenity rich spaces to retain and attract talent and clients, sustainable buildings which support their ESG ambitions, and prime locations close to transport hubs.”