A survey of available office in the capital found that there was a 14 per cent decline in availability over the last 12 months. Since 2009, the total available office space in London has fallen by 48 per cent.
Victoria experienced the most extreme decline in office availability in 2014, with free space in the submarket declining by 46 per cent. According to Deloitte, this reflected a decline across the entire West End.
Chris Lewis, head of tenant rep at Deloitte Real Estate, said that while all “core central London markets have seen a decline” in 2014, the 4 per cent vacancy rate in the West End “is now critically low”.
The drop in availability in the City of London was not as dramatic last year but is nevertheless at its lowest level since 2008. Deloitte found there has been around 5m sq ft of available office space in the City throughout 2014m, despite over 3m of new space having been completed during the year.
Mr Lewis added: “We expect strong occupational demand to remain during 2015 with a limited development pipeline. We anticipate 6.3% rental growth in the City and 8.7% in the West End over the next 12 months on prime Grade A buildings. In some areas where we are seeing very low levels of available space, we could see pockets of super-growth.”