Serviced office stock predicted to run out this year
For companies wanting to opt for serviced offices this year it may prove to be difficult to find space that fits with their business requirements. This prediction comes despite industry experts forecasting that serviced office take-ups could drop.
Jones Lang LaSalle (JLL) has produced research which highlights that although it is likely that office take-up rates will fall in 2012 across the UK there are some cities that could see the stock of high quality office space dry up by the close of the year. Due to increased demand and a shortage of new developments serviced office space in London could be particularly affected. Within 11 months there could be a shortage of prime offices in the City of London with the West End suffering a lack of suitable serviced offices in only 8 months.
It is likely that this shortage will drive the rentals up. The commercial property experts claim that the national rentals will rise by 1.7 percent in 2012 but where there are growing shortfalls the rent prices will be higher. The West End is predicted to experience increases of 3.5 percent and the City a rise of 3 percent.
The JLL research comes at a time when DTZ have published findings which show that low grade C serviced offices far outweighs the availability of higher graded space. Nationally grade C rated offices makes up 70 percent of the total stock available with grade A accounting for 9 percent and grade B 22 percent. However, currently only a low percentage of Grade C office space is on the market but this is expected to change given the challenging economic conditions.
