London West End office rents lowest in six years
Wednesday October 14 2009
London West End office rents fell 30pc in the first nine months of the year, reaching the lowest level since 2003, said real estate broker Knight Frank LLP.
Annual rents for the highest-priced offices in the district were £740 (€795) a square meter (10.8 square feet), the London-based broker said in an e-mailed statement today.
The recession has led to a drop in rent levels as companies seek to cut costs and strengthen balance sheets by using less space. West End rents remain the most expensive in Europe, 7.4pc higher than the top level in Paris.
“The falls have been most pronounced in London and Moscow,” Joe Simpson, head of international research at Knight Frank, said in an interview. “London tends to have the biggest peaks and troughs. If you were to have similar falls in other markets, it would be shocking.”
Average annual rents for the costliest offices in the West End’s Mayfair district fell to £65 a square foot at the end of the third quarter from £92.50 at the end of 2008, said Knight Frank. That’s the lowest since the fourth quarter of 2003 and, after allowing for inflation, the lowest in 13 years.
Tenants in London’s most expensive shops in the West End are paying average annual rent of £5,131 (€5,503) a square meter, 22pc more than retailers in Dublin and more than twice as much as anywhere else in Europe, the broker said.
London is also the most expensive city in Europe for leasing warehouse space.
- Peter Woodifield
© Bloomberg
