Pre-lets growing

Last year we noted the pick-up in the number of companies pre-letting new or refurbished office space prior to completion. In the last 12 months the trend has picked up pace, with some 23 pre-lets announced in 2013 and a further 7 announced in the first three months of 2014. Recent examples include ING Bank at 8-10 Moorgate, EC2; Google at 6 Pancras Square, N1 and Estee Lauder at Fitzroy Place, W1.

Agents are reporting, backed by Metropolis monitoring of current requirements, is that space under offer in central London, suggests that a large number of pre-let deals will be completed in Q2 2014.

There is a trend for office occupiers to move relatively long distances across central London to pre-let the best quality space. High profile examples include Capita moving from the West End to 104,000 sq ft at 10 Aldermanbury in EC2; Hachette moving to 135,000 sq ft in EC4 from Euston; Ramboll moving to 30,000 sq ft at 240 Blackfriars Road in SE1; EY and Shell moving from Southbank to Docklands.

These figures taken from the Metropolis database illustrate the pre-let rise:

Prelet

Signs for the remainder of 2014 look encouraging, with some 4m sq ft under offer to companies such as Havas and Mizuho on various schemes currently under construction in central London. In addition, there are more than 500 lease expiries approaching on over 6m sq ft of offices in central London this year. The only question is will there be enough space to move into?

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