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The market for London offices is “busy again” according to one of the UK capital’s leading developers, with companies willing to commit to office space at higher rents than last year — as long as it is modern and energy efficient.
Derwent London, a FTSE 250 office landlord, said it had leased out about 65,000 sq ft of space so far this year and that tenants had been willing to pay more than expected for the space.
In total, the new lettings are worth £3.9mn in annual rent to Derwent, 8.2 per cent higher than the estimated rental value of the space in December last year, the company said.
Leases worth another £3.3mn in annual rental income are also under offer.
Paul Williams, chief executive of Derwent, said: “London is busy again and maintains its global appeal in an uncertain macro environment.”
That activity is “supportive of [Derwent] management’s view that tenant competition remains keen for the right buildings in the right locations”, said Colm Lauder, an analyst at Goodbody, in a note.
Derwent also announced it had agreed to buy a large development plot on the site of the Moorfields Eye Hospital in east London for £239mn.