Dr. Gleb Tsipursky – The Office Whisperer
Nirit Cohen – WorkFutures
Angela Howard – Culture Expert
Drew Jones – Design & Innovation
Jonathan Price – CRE & Flex Expert
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As experts delve into U.K. office market data for Q1 2024, it’s evident where and how businesses operate is changing. Â
Central London, traditionally the heart of U.K.’s corporate office space, is seeing a notable decline in office take-up, with a 16% drop compared to Q1 2023, and a 37% decrease from the ten-year quarterly average. Â
According to a recent report published by CBRE, the market is experiencing a trend towards more premium, strategically located spaces — catering to the needs of modern businesses, despite an overall decrease in office take-up of 8% year-over-year.Â
The movement reflects how companies are reevaluating their need for traditional office spaces in high-cost central city areas. However, prime rent in London’s West End remains high at £155.00 per square foot, demonstrating a steady demand for top-tier office environments in central business districts.Â
Moving outside of London, CBRE’s data on the office market paints a different picture. Cities like Liverpool and regions such as the South East of England have seen remarkable increases in office take-up, both up by 121%. Â
This growth is reportedly driven by rising demand for “best-in-class” spaces, as highlighted by major deals like BBC Studios Productions acquiring 84,000 sq ft at Typhoo Building in Birmingham and a major lease by University College Birmingham for 44,700 sq ft at Baskerville House. Â
Both transactions reflect a broader market preference for newly developed or extensively renovated spaces that offer advanced facilities and sustainability features.Â
Q1 figures in areas like the Docklands, however, continue to struggle year-over-year. While the high availability in the area fell, there was a notable decline in take-up rates (-18%). Aberdeen also recorded a high Q1 availability rate of 22.4%, and a year-over-year take-up rate of -41%, indicating a surplus of office space in the market. Â
This contrasts with tighter conditions in the South East where the availability rate is at 9.4%. Likewise, areas like South Hampton and West End also boast relatively lower availability rates at 7.8% and 7.0%, respectively. Â
The data also shows how the U.K. market is being influenced by disparities in prime rent values and the strategic decisions of businesses seeking cost-effective areas — particularly in a post-pandemic era where offering flexibility and cost management are important factors in the workplace.Â
