Occupier leasing in Central London tumbled by 57% across the second quarter of 2020, according to a new report from DeVono Cresa.
Source: Shutterstock/Raphael Rivest
The occupier-only consultancy said that prime rents have also started to decline, with a 3% drop for Grade A space and 5% fall for Grade B space on average.
Small and medium-sized businesses deferred leasing decisions in Q2 2020, as average deal sizes rose by 41%.
Meanwhile, availability has continued to climb, albeit by a slower than expected pace, at 8% over the quarter.
Total office space leased for the first half of 2020 was 3.9m sq ft, 43%, down on H1 2019.
“Over the first six months of the year, the market has shifted from a landlord’s market to one favouring the occupier. A change in the market fundamentals of supply and demand are starting to influence both, the choice of space and the price of it across central London. In addition, market and economic uncertainty is leading to a greater appreciation for flexible leasing of workspaces as uncertainties facing business continue,” said Shaun Dawson, head of insights at DeVono Cresa.