City of London Sees Rising Office Demand as Developers and Investors Eye the Square Mile

City of London office demand is rising as developers and investors target Square Mile office space. The City of London Corporation recently highlighted the surge in prime office pre-lets during the annual London Real Estate Forum at the Guildhall.

“These pre-let figures show that the Square Mile faces a welcome challenge to meet increasing demand for the highest quality, sustainable office space. With projects in the City’s commercial real estate market gaining momentum and with our Local Plan set for approval next year, there is no better time to invest in London,” said Shravan Joshi, Chair of the City of London Corporation’s Planning and Transportation Committee.

Rising Leasing Activity in Central London

The latest JLL forecasts for Central London indicate that leasing volumes are set to rise above the long-term historic average in 2025, reaching 10.4 million sq ft. The City of London is leading this growth, with over 28% of floorspace pre-let in 2023, surpassing the five-year average of 27.5%.

Some of the most notable pre-lets include:

• 1 Leadenhall: 70% pre-let, with strong interest in the remaining office space ahead of its targeted completion in March 2025.
• 40 Leadenhall St: 92% pre-let.
• 1 Broadgate: Fully pre-let.
• 2 Aldermanbury Square: Fully pre-let.
• 8 Bishopsgate: 90% pre-let (now open).

These key projects represent a marked improvement over previous developments, which averaged 61% pre-let at completion.

A Record Year for City Office Leasing

2023 marked a record year for the City with 331 office leasing deals, attracting prominent occupiers such as HSBC, Clifford Chance, and Moody’s, alongside a burgeoning tech sector. The City’s robust planning pipeline is set to meet this demand, with hundreds of thousands of square metres of new office space currently in various stages of negotiation and construction.

Ross Sayers, CPA Chair and Head of Development Management at Landsec, noted the attractiveness of the City:

“Major occupiers are continuing to seek modern, sustainable, amenity-rich workspace to attract the best talent. The City’s ability to deliver these workspaces at scale, coupled with the City Corporation’s Destination City vision, are making the Square Mile the obvious choice for major occupiers looking for their new home.”

City Corporation Eyes Global Partnerships

Looking ahead, the City Corporation plans to attend Expo Real in Munich, one of Europe’s premier real estate conferences, to forge partnerships with organisations that can work alongside its vision of sustainability and growth. With a 98% planning application approval rating and a thriving development pipeline, the City is well-positioned to attract investment and meet the growing demand for premium office space.

As the City of London continues to evolve, it is set to remain a key destination for businesses seeking state-of-the-art, sustainable office solutions.

For more updates on local business developments and investment opportunities in the Square Mile, visit EyeOnLondon City, the hyperlocal website bringing you the latest news from the heart of the City.