UK London Office Marketbeat Reports

For the data behind the commentary, download the full Q2 2025 UK London Offices Report.

Re...Right-sizing

During the pandemic and recovery period, the rise of home rather than office-based working led many firms to rethink their workplace strategies. This generally took the form of ‘right-sizing’ reducing office floorspace and often substituting desks for collaboration and creativity areas.

This sparked the ‘less but better’ idea, with some firms taking a less space but of better quality. For those who were locked into their leases, many looked to sublet space deemed no longer needed. Sublease supply subsequently surged to a record high in Q1 2021 at 7.05 million sq ft.

This elevated level of sublease supply continued until Q3 2022, when it started to gradually recede. In the following three years, sublease supply has in fact decreased quarter-on-quarter for all bar one of the last 11 quarters, falling to 4.04 million sq ft in Q2 2025. This is comparable with the 3.75 million sq ft recorded in the pre-pandemic Q4 2019.

Interestingly, this reduction has not been from take-up. Instead, 75% of the decline in sublease supply has been driven by firms taking their space back from the market to reoccupy themselves- well above historic levels. This reflects many companies having over-corrected in their right-sizing measures. Uses for the reoccupied space vary between firms, with the return in office occupancy being a commonly cited factor.

New leases are also reflecting this increased need for space, with London Moves data highlighting that 78% of office movers in 2024 took more space than they were in previously, with the majority also opting for better quality space as well – demonstrating a shift to ‘more and better’.

This trend reflects not only the health of Central London office occupiers, but also the position of the office as the primary and preferred place of work.