City office moves hit two-year low

Office design news from Morgan Lovell

Published on 29-07-2011

Fears about the global economy have seen new office leasing fall to a two-year low in London's financial heartland, figures suggest.

Just 744,000 square feet of new office space was leased in the City during the second quarter, according to a report by CB Richard Ellis.

This represented a fall of 25% from the same period in 2010 and was also 35% less than the 10-year average, the group said.

The findings suggest that firms in the capital are increasingly concentrating on office refurbishment at their existing premises.

In central London, including the West End retail and theatre district, leasing fell 19% to 2.2 million square feet.

Large office moves in London have fallen since the city saw a flurry of credit crisis-delayed deals in the last quarter of 2010.

These included JP Morgan's move into the former Lehman Brothers building in Canary Wharf.

Evolution Securities property analyst Alan Carter said: "Many firms will be considering whether they need to move given the current economic backdrop.

"You also have investment banks announcing lay offs, which produces a knock on effect that weakens demand from the rest of the financial services industry."