The Farebrother commercial agency has noted that Midtown office space is experiencing buoyant levels of property investment, with sales rising by 7% to £577m in the 3rd Qtr of this year.
Activity in the WC1 and WC2 office property market has been spurred on by occupier take-up that is 10% above average. This strong demand has enticed landlords to consider selling, leading to greater market liquidity that is being soaked up by international investors, who have shown an increasing appetite for City office rental assets.
The agency’s Head of Investment Alastair Hilton stated “Yields are under pressure on better quality assets, but they are increasingly hard to find.”
With the final quarter of 2011 still to go, total annual investment in Midtown to date has been calculated to be close to £2bn. The billion-pound figure already beats the combined totals for both 2008 and 2009.
Head of Leasing at Farebrother, Julian Hind also predicted “We have upped our end-of-year projection for total office take-up to circa 2.4m square feet."
Hind went on to pin the current level of demand at "4.7m sq ft, up by 300,000 sq ft on Q2.”
Take-up from clients renting office space reached 583,000 sq ft in Q3, an increase of 5%. Q4 of 2011 is likely to deliver transactions that will take the total beyond the £2.6bn reached before the property asset crash of ’07.
Google has recently joined the list of major companies who are based in Midtown offices, which includes Deloitte consultants, Goldman Sachs investment bank and the McCann Erickson advertising agency.