London's West End
Average prime West End rents hit £122.30 per sq ft (£1,316 per sq m) in the first quarter of 2017, according to Savills.
This was an 11% rise on the levels seen in 2016 and has exceeded the previous quarterly high of £114.31 per sq ft set in Q4 2007.
Savills says that a record rent of £190 per sq ft (£2,045 per sq m) achieved in March at 5 St James‘s Square helped push the Q1 average prime rent to 11% above 2016’s average prime Grade A rent of £110.41 per sq ft (£1,188 per sq m).
Similarly, the average Grade A rent in Q1 2017 hit £85.03 per sq ft (£915 per sq m), 10% above 2016’s Q1 average of £77.25 (£831 per sq m).
Brian Allen, director of the West End leasing team at Savills, said: “The first quarter of the year has seen strong take up and rental levels in the West End, with the deal at 5 St James‘s Square helping prime Grade A rents to hit a ten year high.
“Whilst headline rents remain strong there is some upward pressure on the level of incentives being offered to tenants, with the average rent free period on a 10-year lease now 18 months, compared to the average of 13 months in Q1 2016. Nevertheless, the market remains robust.”
West End Q1 2017 take up reached 1.05 million sq ft (97,545 sq m), 1% up on Q1 2016 and 10% above the 10-year average.
The tech and media sector was the most active in the market, accounting for 22% of take up, followed by professional services (19%) and insurance and financial services (16%).
Savills says supply remains fairly stable, standing at 4.63 million sq ft (430,127 sq m) at the end of the quarter. This equates to a vacancy rate of 3.8%, its third month at this level.
BQ’s commercial property updates are supported by specialist lender Together, which provides funding to businesses and property investors nationwide. With over forty years’ experience in the financial services industry, Together offers short-term finance, auction finance, buy-to-let, residential and commercial mortgages and secured loans. For more information visit www.togethermoney.com
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