Small Office Occupiers – Where will they go in London?

It seems that the appetite for converting offices into residential is at its highest level for many a year. In London, many of the original period houses are being snapped up for residential development either as single dwellings or lateral apartments. Westminster Council have suggested that their planning policies need to be more stringent against the change of use to residential. Many commentators are concerned as to the lack of supply of small office suites going forward.

At Mellersh & Harding we successfully acquire and let many single floors and office suites for tenants. In many London locations tenant demand is outstripping supply. Westminster and Victoria is an area where small companies have traditionally acquired floors of between 1,000 sq ft and 3,000 sq ft. Many buildings have been lost to the residential market and are not being replaced. The large developers such as Land Securities may well be building hundreds of thousands of square feet but these are large schemes with large floor plates and are not of interest to the office tenant with 10 to 50 employees. We have recently brought to the market a 1,300 sq ft office suite in 1 Castle Lane just off Buckingham Gate where the quoting rent of £42.50 per sq ft has generated good tenant interest. 12 months ago the rental values were under £40 per sq ft but the lack of small suites is now pushing the rents forward. Back