2019 is likely to see a continuation of trends seen over recent years in the British office leasing market – most notably larger firms consolidating multiple office premises into fewer buildings with a smarter use of space, and smaller-to-medium-sized businesses going down the route of using flexible or serviced office spaces to expand.
Landlord flexibility outside of serviced offices was key to driving take-up in 2018, with Radius Data Exchange figures indicating average lease lengths for newly-struck deals are now 5.4 years, down from 5.6 years in 2017; as well as rent-free periods moving outwards once again.
This will again be critical to driving activity in 2019 – particularly in second-hand or grade-B space – the lease structures for which have undergone much more volatile changes than grade-A or new-build space.
New-build offices had a great 2018 – with demand for large, pre-development spaces being eminent throughout the year in both London and the regions. My hope for 2019 is that developers are confident enough to keep looking to generate those new builds which not only serve to satisfy global companies’ desire for well-located, quality, smart office premises – but also have a regenerative, refreshing effect on our cities.