BH2 : Property

BH2 has its own in-house research team offering clients first class information services covering all aspects of the real estate market. The tracking of market trends and economic mobility form the key ingredients to our research attributes. We have sought to present our research on the City of London real estate market in the context of a wider economic and political background.

Report Editors:

Dr Savvas Savouri	DDI: 020 7337 1381
Ana Marie Andrews	DDI: 020 7710 7957

Circa 1.02 million square feet was leased during the third quarter of 2008.
Total occupational demand decreased from 8.30 million square feet recorded at the end of June 2008 to circa 7.80 million square feet.
The overall vacancy rate was 8.80%.
Less than £0.50 billion of capital transactions were concluded during the third quarter.

Take-up during the first three quarters of 2008 was circa 3.15 million square feet.
Over 800,000 square feet of floorspace is currently under offer.
Active demand decreased from 3.50 million square feet to 3.35 million square feet. Potential demand decreased from 4.80 million square feet to 4.45 million square feet.

Total available supply at the end of September 2008 was circa 7.70 million square feet of which Grade A was circa 5.80 million square feet.
Of the Grade A floorspace, circa 3.60 million square feet (60.00% of total Grade A floorspace) is currently under construction or is being refurbished and is due for completion in the next twelve months.
The overall vacancy rate was 8.80% and Grade A vacancy rate was 6.60% of total stock.

Less than £0.50 billion of capital transactions were concluded during the third quarter taking the total for the year to date to £2.75 billion.

We continue to forecast that vacancy rates will remain at current levels for at least the first half of 2009 as the expected rate of Grade A take-up will be countered by a further 1.30 million square feet of speculative development due for completion during the next six months.