Large-scale commercial property occupation deals in the City of London are expected to surge this year, with the number of deals carried out so far this year already chasing the total number carried out in 2011 and 2012.
The research, carried out by property services firm, Colliers International, found that just three deals of 100,000 square feet or more were carried out in the City in 2011 and 2012, compared to 11 in 2009 and 2010. This year has already seen two deals completed – involving insurers Liberty Mutual and Amlin – with a number of further deals also in advanced negotiations.
Colliers’ head of offices research, Guy Grantham, said that there were deals nearing completion that involved prime City spaces of 150,000 and 210,000 square feet.
He explained, “Prospects for the remainder of 2013 are similarly encouraging with a number of other occupiers shortlisting and close to finalising decisions.”
Grantham added that the sectors that are engaging in large-scale deals are shifting, with traditional banking and financial companies largely absent from enquiry schedules. He said that although they are seeing positive movement in the large deal market, the largest proportion of activity remains in the clamour for small spaces.
“While the banking sector is on the back foot, Media & Technology (MT) continues to be a major contributor to positive absorption in the City market. MT accounted for 31 per cent of take-up in 2012,” he stated.
“Nevertheless, the majority of activity remains at the sub 5,000 square foot level, with over 75 per cent of deals falling into that size category.”