7 November 2013, Occupiers looking for an extensive, impartial guide to Central London office market rents and rent free periods need look no further thanks to Carter Jonas' research published today by its Tenant Representation team.
The 'Central London Office Market Update: Guide to rents and rent free periods - October 2013' includes:
- Prime West End rents have risen by up to 10% since Q3 2012 and are now £97.50-£120 per sq ft per annum
- Prime City rents are £52.50-£59.50 per sq ft and £65-£70 per sq ft per annum for the upper floors of tower buildings
- Typical rent discounts in the City are between 5-10% compared to 3-5% in the West End
- Prime West End rents are now an unprecedented 85-102% higher than City equivalents
- Carter Jonas forecasts that Central London office rents are predicted to rise by 5-10% by mid 2015
- Rent free periods for 5 year leases are on average up to 12 months for the City, and up to 9 months for the West End
Michael Pain, partner, head of tenant representation, Carter Jonas said: "Rents for prime located Grade A office space in all the Central London sub-markets, save for Docklands, have risen since the beginning of the year due, primarily to the limited supply of vacant floor space, rather than resurgent tenant demand.
"The extent to which discounts can be negotiated on landlord's quoting rents, tends to vary with location and how long a particular property has been on the market. Discounts of 5-10% are not uncommon on some City office buildings that have been on the market for over 12 months. Contrast with quoting rents on prime located Mayfair and South Bank office space where supply side constraints are more intense and where rent discounts of 3-5% are more typical.
"Landlords have been responding to the decline in office vacancy levels and the gradual, but sustained, improvement in demand for Central London office space, which began during Q4 2009, by increasing quoting rents and reducing the level of rent free period incentives that they are prepared to offer to new tenants."
Find out more - Download the report