Take-up in the City of London is on track to surpass six million square feet by the end of the year, according to international real estate advisor Savills.
Over one million square feet of space went under offer in August, bringing the total amount of space currently under offer in the City to 2.8 million square feet which is up on the long term average by 116%, according to the latest data from the Savills City Office Market Watch report.
‘With nearly three million square feet currently under offer we can expect to see an active final quarter. Take-up is likely to surpass six million square feet, which seemed highly unlikely earlier this year,’ said Josh Lamb, director in the City office agency team at Savills.
Take-up for August in the City of London reached 421,421 square feet across 26 deals, resulting in the total for the year reaching 3.9 million square feet.
The largest deal to complete in August saw Convene acquire levels three through to six at TwentyTwo Bishopsgate, EC2 equating to 99,297 square feet. The US based serviced office provider has chosen this space to be their first international location outside of the US. The flexible workspace operator acquired the space at a rent of £65per square feet on a straight 15 year lease. The building is expected to complete in the first quarter of next year.
‘We expect to see the rate of rental growth in EC2 and EC3 next year to outstrip the rental growth experienced this year. Approximately 1.8 million square feet of new space is being delivered into EC2 and EC3 next year, and the combined five year average grade A take-up for these postcodes is three million square feet, suggesting stronger rental growth as vacancy rates fall,’ Lamb added.
