Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting cushmanwakefield.com to read:%0A%0A {0} %0A%0A {1}

London Occupiers Moving Further to Secure the Best Office Space

29/07/2019
  • Relocating London businesses are moving further than at any stage over the last six years - on average 1.23 miles
  • More than half (57%) of all movers opted to relocate to a different submarket 
  • West to East London migration prevails with 40 eastward moves
  • Submarket ‘winners’ coinciding with development
  • 2.1 million sq ft of additional office space acquired

The geographic bias of London’s corporate occupiers has significantly diminished in recent years according to new research from Cushman & Wakefield, with over half of occupiers (57%) moving some, or all, of their operations out of their existing submarket in 2018 and increasingly further afield.  

In “Movers & Shakers | 2019” Cushman & Wakefield has analysed the migration patterns behind thousands of leasing transactions above 10,000 sq ft across the capital since 2013 and recent (2018) patterns show that the movement between markets is becoming more fluid. This has continued into 2019 with the European Bank for Reconstruction and Development (EBRD) agreeing to move its headquarters from the City to Canary Wharf and Global Brands who will relocate to White City from Marylebone.

Hayley Armstrong, Senior Insight Analyst, UK Research & Insight London at Cushman & Wakefield, said: “With the role of real estate becoming a key tool in forming corporate identity and managing talent retention, modern businesses are brushing aside the notion of traditional boundaries. Instead, they are moving further afield to secure the right space that meets their requirements and reflects their brand. The average distance moved by companies is now at a six-year high of 1.23 miles and is predominately eastward towards the City.” 

Mayfair, North Oxford Street and St James’s witnessed the greatest net migration of occupiers in 2018 losing 12, 6 and 4 occupiers respectively. City Core experienced the greatest net positive balance, gaining 32 occupiers. City Core occupiers also demonstrated the greatest loyalty to their submarket, with 53 out of 114 (46%) of transactions originating from companies already located in the City. 

“While recent availability in the City Core and its surrounding submarkets has resulted in a significant inflow of occupiers, conversely, an enduring lack of stock in the West End office market is triggering a notable migration out of the area. This outward migration has been further compounded by its traditional occupiers – from public & government, retail and media sectors – being amongst the most footloose in London and are prepared to consider London as one whole market to explore,” added Alistair Brown, Head of London Markets at Cushman & Wakefield.
 
Increasing fluidity between submarkets as occupiers prioritise product and amenity over traditional location has seen areas such as White City and Paddington prove the adage – “if you build it, they will come”. An increase in development completions in 2018 has coincided with positive net migration of 8 and 6 new occupiers, respectively. Cushman & Wakefield forecasts that the record take-up levels that followed the delivery of new quality space in these submarkets could further encourage developers to seek out other emerging locations further afield such as West London, Southbank and Vauxhall, Nine Elms and Battersea. At the same time, the homogenisation of rents in the current fringe submarkets could see occupiers increase their search perimeter in search of value.

Despite the continued uncertainty surrounding the UK’s position on Brexit, the acquisition of overflow space or expansion space continued to accelerate in 2018, with an estimated 2.1 million sq ft of extra space acquired (24% growth year-on-year). This has been driven by the tech sector which acquired an additional 1.1 million sq ft of office space and is a trend that is expected to persist as the capital continues to attract significant scaleup investment. The professional services sector accounted for a further 293,000 sq ft of additional space, a 64% year-on-year growth. Flexible workplace operators and educational & medical users also expanded their footprint 2% and 17% respectively. 
 
“The media and technology sectors should be a key driver in the London leasing market and will continue to fuel the migration and fluidity between London submarkets as they seek out places and buildings that support their need to attract and retain the best talent.” Concluded Brown.

 

MEDIA CONTACT

Lauren Joselyn Cushman & Wakefield
Lauren Joselyn

Associate Director, EMEA Communications • London

RELATED SERVICES

Offices Leasing

Cushman & Wakefield provides a bespoke office leasing service to investor, developer and public sector clients across the UK & Ireland.

Learn More
Occupier Representation
Our Occupier Representation team will support you through the entire process of your search for an office, retail or industrial space, from the beginning all the way to signing the lease and fitting out your new premises.
Learn More
Offices - Capital Markets

Our market leading national Office Capital Markets team creates strategies which empower our clients to reach their goals whether buying, selling or developing office properties.

Learn More
Project Development

Whether you’re an occupier or investor in real estate, working on a single asset or across an international portfolio, we’re ideally placed to support you with a comprehensive range of Project & Development Services.

Learn More
Business Rates
Business rates represent a major cost for both occupiers and owners of non-domestic property. 
Learn More
Valuation & Advisory

Giving you the confidence to make informed decisions.

Learn More

RELATED STORIES

Entre Deux Maastricht INVESCO
Invesco • Banking & Financial Services

IREEF is a flagship fund of Invesco Real Estate comprising core and value-add assets across Europe.

Prague’s Newest Retail and Leisure Destination
Crestyl
Savarin is a brand-new destination for shops, restaurants, cafes and entertainment in the heart of the city.
Learn More

INSIGHTS

Future of Cities
Insights • Economy

Future of Cities

Structural forces are creating significant change to how we work, shop, live and move around our cities. Now is the time to consider their future. This is our vision for UK cities in 2040. 
Richard Pickering • 21/09/2022
Cinema
Research • Retail

The Bigger (Motion) Picture - Cinema Insight

Cushman & Wakefield takes stock of the current market conditions that threaten the cinema industry and highlights some of the many opportunities that are likely to shape its future.
Edward Bavister • 24/08/2022
person painting wall red with a roller brush
Insights • Occupier

How much does a commercial interior fit-out cost in 2019?

The 5th Edition of our London and South East Occupier Fit Out Cost Guide provides latest data driven insights into the costs associated with the delivery of low, medium and high-quality specification fit outs in London and the South East.
16/04/2019

CAN'T FIND WHAT YOU'RE LOOKING FOR?

Get in touch with one of our professionals.
With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Cookies.
MORE OPTIONS
Agree and Close
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All
SAVE SETTINGS