Since 2019, rents have plunged dramatically in some locations, with Marylebone and Paddington posting 55% and 50% falls respectively. However, The Instant Group says demand for flexible workspace in the capital is starting to show signs of recovery.

“Looking back over the past 12 months, we are starting to see rates in some areas of London pick up,” says John Williams, director at The Instant Group. “Areas such as Kensington [+24%], Euston [+25%] and Bloomsbury [+18%] have all shown strong signs of recovery as companies are starting to finalise their return-to-work strategies.”

Although St James’s remains London’s most expensive area for flexible workspace rents, rents in the area fell by 25% from an average of £899 per workstation a week in 2019 to £677 in 2021. Euston was the only area to enjoy an increase in the rate during the period, with average rents up 6% from £492 to £520.

While rents charged for flexible workspace in many central London locations have fallen, they have risen in the commuter belt on the outskirts of London. Maidenhead saw the biggest rise, with average rents in 2021 recorded at £414 compared with £296 in 2019 – up 40%. Harlow (27%), St Albans (10%) and Milton Keynes (7%) also enjoyed strong rental growth as occupiers looked to take space outside the capital.

“Outside London, demand for flexible workspaces has increased, along with prices,” says Williams. “During the pandemic, lots of businesses relocated to the outskirts of London. For some this was temporary; for others the move was permanent. With many staff not wanting to commute into the city during Covid, we saw the pricing drop as operators fought to retain clients and attract new ones.”