Total office occupancy costs across the UK have remained stable in the first half of 2013, according to new research by BNP Paribas Real Estate, the leading international property adviser.
The report, which focuses on a high level view of rents, rates and service charges for Grade A offices across the country over the first six months of the year, highlighted that costs rose in several locations, with the largest increases taking place in: Swindon, where costs rose by 12% to £23 per sq ft, Watford, where costs rose by 9% to £37 per sq ft, Hammersmith, where costs rose by 5% to £55.50 per sq ft, and the West End, where costs also rose by 5% to £160.50.
Several UK locations also witnessed drops in total office occupancy costs, including: Redhill/Reigate, where costs fell by 4% to £38 per sq ft, Newcastle out of town market, where costs fell by 1.7% to £26.50 per sq ft, and Southampton, where costs fell by 1.5% to £31.75.
BNP Paribas Real Estate’s head of offices, Dan Bayley, comments: “It is unsurprising that occupancy rates have remained fairly stable across the country, as occupiers are still looking to secure good deals within Grade A offices. Positively, the South East market is performing well, as activity levels have started to pick up. The markets north of the M25 have also seen rental growth.”
“The peripheral west London markets of Chiswick and Hammersmith have once again performed well, reflecting the popularity and strength of demand for space in these locations, boosted by the close proximity to London. In many northern locations, rental performance has been fairly flat, reflecting the more subdued activity levels. Unsurprisingly, occupancy costs remain the highest in Central London,” added Bayley.