The demand for office floor space has rebounded strongly in the Eastern M25 market, with total requirements reaching an all time high of 3.7m sq ft (excluding Docklands). The majority of demand is focused towards the East London market although occupiers are being flexible and considering other locations within the Eastern M25 region in order to identify their ideal accommodation.

The increase in demand has yet to feed through to increased leasing activity, with a total of only 1.1m sq ft acquired in the first nine months of this year. Whilst activity remains significantly below trend levels, the full year figures are expected to be ahead of 2020’s figure when take up fell back to 1.2m sq ft.

Docklands has seen the greatest fall off in activity, with only 216,000 sq ft of lettings achieved in the year to date. Whilst last year saw a drop off in larger transactions, the past few months has seen a return of this sector of the market, with Apple taking 66,700 sq ft at 1-5 Bank Street E14.

The East London and Dockland’s markets remain the primary locations for larger occupiers, with these two markets providing 95% of buildings able to accommodate requirements of 50,000 sq ft and above. Overall supply has increased slightly to 7.1m sq ft, of which only 1.6m sq ft is of Grade A standard, again the focus of which is within the East London and Docklands markets. Outside of these regions, there is an acute shortage of grade A accommodation, with the majority of space being in refurbished stock. The availability rate across the wider Glenny region now stands at 7.8%.

Prime rents and capital values have remained stable but we expect the next 12 months may see some upward movement as occupiers target better quality accommodation.