London Office Agency Lockdown Trends
A few trends have emerged over the last seven weeks, and our office agency team summarise below some of the key trends from the enquiries and feedback we have received since the UK has entered lockdown. These will continue to evolve as we now enter a ‘post-lockdown phase’, but we hope to provide a useful backdrop:
- The number of office leads has of course fallen, but from the lowest point of activity in the first week of April there has been a steady rise in the volume of leads coming forward – particularly since the start of May.
- We have seen a 76% increase in the number of leads (compared to February 2020) for office accommodation in ‘suburban’ office locations – with leads for Islington and Hackney / Hackney Wick instructions being particularly prominent.
- It is too early to tell whether this trend will continue, how solid these enquiries are and how it might result in any discernible shift in market sentiment. Still, many of the occupiers making these enquiries are exploring opportunities to cut property overheads, and reduce their reliance on having/needing all their staff in a central London location.
- The number of leads for serviced office space has fallen – understandably bearing in mind the short lead-in times for signing up to space – but some of the unknowns and practicalities around accommodating social distancing requirements post-lockdown may also be influencing this.
- That said, the trend for flexible lease structures and fully fitted and Cat B + space will also continue as occupiers demand fully fitted office options and so the flexi-office market is here to stay
- We have seen an uptick in the number of enquiries to purchase office accommodation – particularly from SIPP/SASS buyers and small businesses looking to downsize. However, there remains considerable caution in terms of pricing, concerns over funding (where needed) and much hesitation!
- We anticipate continued enquiries post-lockdown from the Charity/Third Sector occupiers as well as the medical sector – with there still being a general shortage of Class D1 stock in the marketplace.
- One of the key strengths of our commercial agency work is the wide range of enquiries we receive by virtue of the diversity of commercial property we handle – which extends across a wide geography of London. We are working with many clients on exploring options for a change of use to Class D1 and other suitable alternative commercial uses as a means to widen occupier interest and demand
We will keep you updated as things progress, and in the meantime, please get in contact with our team to discuss any of the trends set out above and how we can assist in capitalising on these for you - or a general catch up.