New research shows that the proportion of central London office space that was vacant dropped from 4.55% in October, while take-up reached 620,000 sq ft. This brought the annual total to 12.4m sq ft, exceeding the long term trend of 12m sq ft.
The largest deal of the month was Deutsche Bank’s acquisition at Land Securities’ Zig Zag building in Victoria, which is now close to 80% let one month after completion. Nearby Victoria development Nova South, which is due for completion in Q2 2016, has attracted occupiers Egon Zehnder and Advent International while Pret a Manger is under offer on 30,000 sq ft at Tishman Speyer’s Verde scheme, due to complete in Q3 2016.
BNP Paribas say that office completions in 2016 will total 7.03m sq ft, one fifth of which is already committed. Notable pre-lets at schemes due to complete next year include One New Street Square to Deloitte, One Rathbone Square to Facebook and Three Pancras Square to Havas.
Head of central London leasing at BNP Paribas Real Estate, Dan Bayley said: “The delivery of grade A product in 2016 will come as a welcome relief to occupiers struggling to find large floor plates in central London, especially as the vacancy rate continues to contract at pace.”
Investment turnover in November reached £1.81bn, bringing the overall volume for 2015 to £15.43bn, surpassing the long term annual average of £13.5bn.
Head of City investment Richard Garside said: “With approximately £2bn of further deals under offer, the expected December flurry will push year end levels even further above long-term average.”