JLL has calculated that over 7.4 million square feet of office space in Central London have been transacted so far in 2021.
JLL’s latest research also highlights that around 2.8m sq ft of commercial space is currently under offer across Central London and that take-up is on track to reach 8.5m sq ft at year’s end. This figure is considerably ahead of the 4.7m sq ft of space that was leased in 2020, and while this is still below the 10-year average take-up of 9.9m sq ft it does reflect a significant recovery for the London office market.
JLL reported that the City office market has seen 3.9m sq ft of transactions so far in 2021, with the final take-up for the year expected to reach 4.5m sq ft. Over 3.3m sq ft of space has been transacted in the West End to date and JLL has predicted that this is set to reach 3.8m sq ft by the year-end.
JLL cited that throughout 2021, the tech sector has been most active across the central London office market, accounting for 26 per cent of all transactions. Significant tech sector acquisitions include those by Facebook, IBM, Inmarsat, Apple, TikTok, Snapchat, Gamesys and ITV.
Looking ahead to 2022, JLL has identified 8.5m sq ft of active demand for new office space across central London demonstrating occupiers' long-term commitment to both London and the new workplaces for their people.
Jeremy Attfield, head of City Office at JLL, said: “The City leasing market has not only seen a recovery but also a considerable uplift in transactional activity compared to 2020. There have been a number of significant pre-lets, especially in the legal sector, and we suggest this pre-letting market will continue to thrive throughout 2022. Occupiers are focused on aligning their real estate portfolios with their ESG commitments and this will translate into increased demand for the best space to meet their sustainability, health and wellbeing targets.”
Chris Valentine, head of Central London Agency at JLL, added: “Whilst take-up has rebounded strongly across Central London in 2021, the West End market has seen a faster recovery than the City and leasing volumes are set to exceed the 10-year average this year. London’s global importance as an office location, combined with its broad sector mix of occupiers, has underpinned its strong recovery and as we look to 2022, we continue to see new requirements launched as businesses remain committed to long-term strategic workplace plans that focus on the acquisition of best-in-class space.”