London copes better than rivals with less vacant office space recorded
Leading global cities are continuing to feel the hit from the pandemic’s home working boom, but research shows London’s office sector is faring better than in New York and Paris.
Vacancy levels have moved upwards in all three since the pandemic began, real estate data firm CoStar found, with lockdowns, the rise of hybrid working, and new property completions leading to millions of extra square feet being added to the market.
In London the office vacancy figure stood at 7.9% at the end of 2022, higher than the 5% recorded in the final quarter of 2019 before the Covid crisis.
Paris and New York late last year both stood at 12.5%, compared with 7.4% and 8.1% respectively pre-pandemic.
The research said in London there are differences in a number of submarkets, with rates as low as 3% in Paddington and Westminster, as well in some outer London boroughs such as Enfield. That is in part due to improving demand and less supply.
Mark Stansfield, senior director of analytics at CoStar Group, said: “There is a flight-to-quality trend playing out in all three cities, as firms prioritise high-quality space to lure back staff, welcome clients and meet growing environmental commitments even as most take less space overall amid an ongoing pivot to hybrid working.”