The Central London office investment market has had another exceptionally strong year with total turnover for 2015 expected to reach £19.4 billion, marking an 80 per cent increase on the long-term average (£10.8 billion).

The volume – which includes £2.95 billion currently under offer expected either to exchange or complete before the end of the year – is only circa 10 per cent down on the all-time record year of 2014 (£21.6 billion). This may come as a surprise to some, given some early negative comments post summer.

Driven by an increasingly diverse investor group, 2015 has included a greater proportion of UK-based investors than recent years. Overseas appetite for London remains strong, with Middle Eastern, US and Asian buyers continuing to drive the market. Interestingly, Taiwanese investors have been particularly active in 2015, growing to hold a 21 per cent share of all Asian investment into Central London. If we focus on China, it’s worth noting that despite a slowing domestic economy, Chinese investment into London currently represents 11 per cent of total turnover, in line with 2014.

Improved property fundamentals have helped drive yields to record lows.The City has seen prime yields move to end the year at 4 per cent while in the West End yields end the year on 3 per cent.

So long as property offers attractive comparative returns, the current level of interest, particularly in London’s trophy assets, will continue. Moreover, as Central London occupiers become evermore footloose, the now established markets of Southwark and Shoreditch, amongst others, are receiving increasingly more interest from investors looking to take advantage of positive rental growth forecasts.

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