London, 07 November 2025 - Cushman & Wakefield’s latest Central London Marketbeat Q3 2025 report highlights a strong rebound in the capital’s office investment market. Year-to-date volumes have reached £6.43 billion, already exceeding the full-year total for 2024 and signalling increasing confidence among investors.
In the third quarter, £1.67 billion was transacted, with the West End continuing to lead activity, accounting for 74% of quarterly volumes. Notably, 10 deals over £100 million are currently under offer or have completed in the fourth quarter to date, indicating improved liquidity in larger lot sizes.
Martin Lay, Head of London Office Capital Markets at Cushman & Wakefield, said: "These figures for the Central London investment market a show a clear sign of improving liquidity and investor confidence. With strong occupational fundamentals and a more favourable lending environment, we expect investor appetite to continue building into 2026."
Prime yields remained stable in the third quarter, holding at 5.5% in the City and 3.75% in the West End, following inward movements in the previous quarter. With inflation easing and further base rate cuts anticipated, the outlook for capital markets is increasingly positive.
On the occupier side, demand for high-quality space remains robust. Grade A offices continue to dominate leasing activity, however the development pipeline is not keeping pace. Across Central London, there is 6.28 million sq ft of space under construction and available due to be delivered between 2026 and 2028 – circa 2 million per year. With average annual Grade A take-up of 5.8 million sq ft recorded since 2021, there is a clear supply and demand imbalance of high quality stock, creating competition and putting continued upward pressure on rental values.
James Campbell, Head of London Office Leasing at Cushman & Wakefield, said: " Occupiers remain focused on securing premium space in the best connected locations, full of F&B, leisure and amenity, but the supply of Grade A offices in these core markets is set to fall below one year from 2026, based on future development completions and average annual grade A take-up.”
With vacancy rates tightening in key submarkets, such as Mayfair where Grade A vacancy now stands at just 2.36%, the imbalance between supply and demand is expected to intensify. This reinforces the case for rental growth and further development activity across Central London.