The London office market started the year marked by uncertainty and expectation about how the economic and political developments of 2016 would play out in the medium term. In this article we look at the key figures and trends that have defined the market during the first three months of the year.
London Office Market Q1 2017: Facts and Figures
The most important transaction during the first quarter of the year was the 15-year lease of floors 1 to 7 of 21 Lime Street. This deal is also worth mentioning as it seems to buck the current trend of insurance companies moving out of the City, where vacancy rates increased to 5.7 per cent. This increase can be accounted for by the growing number of occupiers who are now relocating to other areas, mainly the Docklands and Southbank, where construction activity is reaching record levels having experienced year-on-year increases of over 660 per cent.
Take-up rates increased monthly during the first quarter of the year, reaching a maximum index of 1 million square feet in February. This figure represents a 92 per cent increase over the previous quarter.
On 29 March 2017, the British Prime Minister officially initiated the Brexit process by triggering Article 50. This was surrounded by much speculation and uncertainty about the impact it would have on the country’s economy and at a smaller scale, on the day-to-day of UK businesses. Although according to EU legislation, many things could still change during the upcoming negotiation process, the general consensus is that the implications of Article 50 will mainly affect trading relationships, access to human capital and to funding, and the free movement of services.
Soon after the EU referendum vote, the Irish capital began making headlines as eyes turned westwards and Dublin emerged as a potential prime destination for companies considering relocating their London offices elsewhere in the EU. In fact, Dublin is already home to some large corporates in many high-value sectors, such as Citibank, Bank of America, JP Morgan, Google, LinkedIn, and Facebook.
During 2016, the UK’s office market experienced a few ups and downs linked to political uncertainty and decreased consumer and investor confidence. In spite of this, the overall market performance did not stray far from what was expected: strong levels of leasing activity in the Big 6 office markets (namely Birmingham, Bristol, Edinburgh, Glasgow, Leeds and Manchester), sustained rental growth due to the limited availability of Grade A space in cities like Birmingham, Bristol, Leeds, Manchester, London, Cardiff, Edinburgh, and Glasgow, and a notable surge in the number of lettings closed in London towards the end of the year. Are these trends expected to continue during 2017?
The Titanic Quarter involves a master plan that will see the development of 185 acres of waterfront land in Belfast over the next three decades. With planning permission in place for some four million square feet, the development project will see new spaces for work and living emerge in coming years. In addition to developing a Media Campus and extending the Financial Services Campus, the site will see new leisure and tourism projects that will draw residents and visitors to the city.
Preparing for Christmas entails a lot of planning to ensure offices are not short-staffed or important documents delayed because of the holiday. The season is a busy time of the year, when businesses experience changes to their own operations, from upticks in activity to significant slowdowns due to clients and others taking time off to enjoy the holiday.
Barnsley was once an industrial town with thriving coal mining and glassmaking industries. The South Yorkshire town is now at the centre of regeneration efforts. In 2002, Barnsley Metropolitan Borough Council launched a regeneration programme designed to revitalise the town centre with an improved transport interchange, a new digital media centre, 
The Midlands in the heart of the UK represents an important economic region for future growth. From 2011 to 2015, there were 880 foreign direct investment projects in the region alone. This represents a quarter of foreign direct investment into the UK according to the Regeneration Investment Organisation (RIO), which is part of UK Trade & Investment (UKTI). International companies are investing in the Midlands thanks to excellent transport links that include three international airports (East Midlands, Birmingham and Luton). There are also no less than 27 universities in the region that offer businesses a strong talent pool and resources.