During April, we saw the inevitable short-term impact of the Covid-19 lockdown materialise with West End take-up reaching just 35,481 sq ft. This was the lowest monthly take-up on record with leasing activity remaining subdued across central London as a whole. So far this year 653,228 sq ft has been let across the West End, this is down 49% on the long-term average for this period.

The record low level of activity in April was more of a reflection of the initial reaction to the unexpected event and a full month of lockdown. And we have already seen more than double the amount of space let in April complete in May.

The largest transaction, and the only transaction over 10,000 sq ft that completed during the month, was at 1 Eagle Place, SW1 (13,960 sq ft), with Leonardo acquiring a six-year assignment of the first and fifth floors from Virgin Money.

Space under offer has continued to remain at a high level, substantially above the long term average by 117%. During the month we saw an additional 81,000 sq ft going under offer, bringing the total to 1.52m sq ft, and outweighing the 15,000 sq ft of transactions which fell through as a result of Covid-19 in April. Space under offer was up 5% oh the previous month’s 1.45m sq ft and notable space that is currently under offer include Invesco’s 20 Manchester Square development, W1 (100,000 sq ft), 210 Euston Road NW1, (70,000 sq ft) and the 3rd floor (40,000 sq ft) at 80 Charlotte Street, W1.

Around 450,000 sq ft of active tenant requirements were put on hold in April and at the end of the month central London and West End active requirements stood at 4.4m sq ft, down 15% on the start of this year.

However the overall quantum of active and potential central London & West End requirements continues to remain at a high level and at 5.5m sq ft, was only down 6% on the average we have seen over the past two years.

The vacancy rate was up 10 bps on the previous month with supply standing at 4.8m sq ft, which equated to a vacancy rate of 4.3%. We started to see a slight uptick in tenant space with tenant controlled supply rising by 1% during the month to 26%, an additional 48,000 sq ft of tenant space is expected to become available next month.

9.3m sq ft developments are scheduled for completion over the next four years, down 8% on the 1.1m sq ft we anticipated at the end of 2019. A further 200,000 sq ft of extensive refurbishments and new developments which were scheduled for delivery this year have been pushed further out into 2021’s pipeline and, as a result, development completions for this year are set to reach 855,0261 sq ft. This will be the lowest level of annual completions in over nine years, with 57% of this year’s pipeline already pre-let.

We expect the limited level of development completions will continue to further stimulate pre-letting activity with the development pipeline already accounting for 40% of space that is currently under offer in the West End.

Analysis close up

Search for a commercial property