Companies seeking office space in the capital are being told to plan as far as five years ahead as a supply drought looms, a leading property agent said today.
London’s property boom has been good news for landlords but companies looking to relocate to new offices are running out of time, according to agent CBRE.
A raft of big names are looking for large offices in the capital with internet giant Amazon searching for another 380,000 square foot straight after taking 210,000 square foot at Sixty London, while Omnicom, Estee Lauder, Mishcon de Reya and Yahoo are all on the hunt.
CBRE says companies should plan up to five years in advance to be sure of securing new space. Tenant advisory experts Simon Calvert and Frances Warner-Lacey said: “Employment is at a record high in the capital. The fall in office supply is now greater than the demand. Take up of new office space is as high as pre-2007 but there is now starting to be less choice.”
CBRE’s latest third quarter property market review showed “availability is nearing its peak” in central London and “rental growth is forecast in all central London markets” next year.
New developments were shelved during the financial crisis due to funding. CBRE’s research shows that development completions will peak at 6.7 million square feet next year when many of the City skyscrapers are finished, but there are fewer new buildings to be completed in the following years. Calvert said: “Since 2007 it has been tenant friendly market but it is now on the cusp – rents will begin to soar.”
