Capita Symonds鈥� report shows buoyant office market in the capital

Rental values climbed 14% across London last year as the restricted supply of office space continued to drive up rates.

A report by Capita Symonds found rent rose particularly sharply in the City and Docklands areas, up 25% and 33% respectively.

Rates in these locations returned to December 2008 levels, Capita Symonds said.

Take-up including lettings, sales to owner occupiers and pre-lets also rose strongly, up 37% from 2009. But take-up in the fourth quarter fell by 41%, reflecting the lack of new offices.

Alan Dornford, director in Capita Symonds鈥� real estate division, said: 鈥淭he last quarter of 2010 ended with a sharp fall in take-up of offices across central London markets. But the low-key end to the year disguised the fact that 2010 overall has been a year in which central London markets have recovered strongly.

鈥淎t the root of this performance is the dwindling stock of grade A space and a development pipeline which is at an historically low level. In the city, for example, just 1.3m sq ft is scheduled for completion in 2011, with nothing beyond that.鈥�

Last year the number of unoccupied commercial spaces fell to 8%, from 9.1% in 2009.

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