There has been a lot of talk about the ‘death of the office’ in the post covid world and in particular the demand for office space in Central London as occupiers downsize their office requirements and move to decentralized locations in the midst of flexible working, WFH and the push to reduce commuting times. Shortages of talent have certainly driven many businesses to review their working practices, as employees demand greater flexibility in their working week but there has been a renewed drive (and desire) to return to the office and this certainly has been borne out by the research undertaken by West End specialists BDG Sparkes Porter.
The team at BDG Sparkes Porter have looked at the market trends between in the pre-covid (Q1 2018 to Q1 2020) and post-covid (Q1 2021 to Q1 2023) West End eras and this has revealed some interesting findings, some of which challenge the perceived ‘new normal’:
If WFH has become the norm, this certainly isn’t reflected in the office take up figures, where the average take up per quarter pre-covid and post-covid have remained almost exactly the same (719,000 sq ft vs 723,000 sq ft).
The data shows this to be correct, with the average take up of ‘Grade A’ space has risen by 40% post-covid, with ‘Grades B & C’ decreasing by 36% and 32% respectively.
In contrast to what many speculated would happen there has been no major trend of tenants decreasing their office footprint post-covid, in fact there has been a 12% increase in take of space in excess of 20,000 sq ft.
Whilst the majority of sectors stay fairly static in activity across the pre-covid and post-covid the clear outliers are Financial Services, with an increase from 29% to 47%, and Business & Professional Services with a decrease from 26% to 9%.
Pre Covid Lettings
| Jul-19 | Turner House 14-18 Great Marlborough St, W1 | Diagio | 129,243 |
| Jul-19 | The Post Building, WC1 | Nationwide Building Society | 90,000 |
| Nov-19 | Soho Place, W1 | Apollo Global Management (Pre let) | 83,100 |
| Sep-19 | Marble Arch Place, W1 | Bridgepoint Capital (Pre Let) | 83,000 |
| Mar-19 | The Hanover, W1 | Glencore (Pre let) | 53,916 |
| Jul-19 | Met Building, W1 | WPP | 43,892 |
Post Covid Lettings
| Jul-22 | Lansdowne House, W1 | Blackstone (Pre let) | 225,000 |
| Dec-22 | The Earnshaw, W1 | GSK (Pre let) | 161,050 |
| Feb-23 | 19-35 Baker Street, W1 | PIMCO (Pre let) | 106,087 |
| Oct-22 | 20 Manchester Square | Lazard (Pre let) | 81,725 |
| Jun-22 | 20 Carlton House Terrace, SW1 | BP (Pre let) | 67,000 |
| Jun-22 | 22 Baker Street | Forsters | 52,855 |