3. Occupier Markets
Stronger than expected economic performance of the UK since the referendum has fed through to robust leasing activity. Further, the number of companies which have relocated people and activities outside the UK since the referendum on fears related to the UK’s future trading relationship with the EU has been limited to date.
“The actual count is relatively small in terms of firms and the number of jobs is in the hundreds, not the thousands,” according to Elisabeth Troni, head of EMEA research and insight at Cushman & Wakefield.
Since the referendum, growth rate in UK office employment has moderated while take-up of UK office space has increased, according to Cushman & Wakefield. However, the expectation for UK office take-up over the coming two years is for take-up rates to decline, synching with the UK office employment rate. “There will reconverge over the next couple of years,” Troni said.
Rental outlook for the City of London – assuming a no deal Brexit is averted – is for a much softer decline in growth rates. Prime rents have held up much better than expected, currently trading at between £65-68 psft, with smaller deals often above £70