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Our View

Prime office rents have remained largely stable since the end of the pandemic, with activity in most markets being held back by uncertainty about the prospects for the office market and more recently concerns about the general economy. Stratford in East London, which is now a 'two tier' market continues to attract the highest rent outside of Docklands peaking at £45 per sq ft for stock within the Olympic Park area, whilst most other regions have peaked at £30 per sq ft on average. Prime rents have slipped by 0.5% across the Eastern M25 over the past 12 months, with the greatest pressure being seen in those markets outside of the M25.     

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Market Comment

Prime office rents have remained broadly static with 14 of the 16 locations covered by the Glenny Rent Survey remaining stable over the past six months. The only locations to see rents grow over this period have been Bromley, where rents moved to £30.00 per sq ft and Basildon, where rents moved up to £22.50 per sq ft off the back of a lack of supply.

This short term stability masks the underlying trend, where rents remain under significant pressure due to the weakening in the demand for office floor space as many traditional occupiers are downsizing in the light of flexible working.

Owner occupier capital values have come under pressure since the latest round of interest rate rises, falling by 10.7% on average over the past six months and 15.4% over the year. The most significant falls have been seen in the Inner M25 markets, where capital values are down by 11.3% and 17.9% over six and 12 months respectively. Outside of the M25, the falls have been less marked, with falls of 9.9% and 11.9% respectively.    


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John Bell

John Bell

Equity & Managing Partner, Head of Commercial Agency
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