Resilience in 2025
Central London office take-up closed 2025 with Q4 activity totalling 2.69m sq ft, broadly flat quarter-on-quarter, with a marginal increase of 0.2%, but down 10.2% compared with Q4 2024. While activity softened towards year-end, this was offset by a strong start to the year, resulting in full-year take-up rising 9.8% year-on-year to reach 11.5m sq ft.
Large transactions underpinned overall activity, with 32 deals above 50k sq ft completed during 2025, marking the most active year for this size bracket since 2021. Notable Q4 transactions included Visa securing 300,000 sq ft at 1 Canada Square, E14, alongside FTI Consulting pre-letting approximately 102k sq ft at One Exchange Square, EC2.
Banking & Finance remained the most active sector in Q4, accounting for 23.6% of Central London take-up. Professional Services followed closely with a 17.6% market share.
Secondary Market Strength
Core markets experienced a quieter close to the year. The City recorded 1.2m sq ft of take-up in Q4, a 4.5% quarter-on-quarter decline, sitting just below the five-year quarterly average of 1.3m sq ft. Despite this, the City remained the dominant market, accounting for 44.2% of Central London take-up during Q4 2025. The West End also saw a moderation in activity, with take-up falling 16.1% quarter-on-quarter to approximately 513,000 sq ft, although this remained above longer-term average levels. In contrast, secondary markets finished the year more strongly, with locations such as Southbank and Docklands recording their most active quarter of 2025 in Q4.
Grade A Dominance
Grade A space continued to dominate demand, accounting for 71.9% of Q4 take-up and 70.9% of total take-up across 2025. This sustained preference for best-in-class accommodation has continued to place upward pressure on rents, with West End prime rents increasing by 6.3% over the year to £170 per sq ft, while City prime rents rose 6.1% to £87.50 per sq ft.
A strong start to 2025 offset a softer year-end, with large, Grade A-led transactions driving Central London office take-up to its highest annual total since 2022.
Tightening Conditions
Central London office supply continued to contract through 2025, ending the year at 23.3m sq ft. This represents a 17.3% year-on-year reduction and places total availability below the ten-year average of 24.4m sq ft.
Second-hand space continues to dominate the market, with Grade B accounting for 82.1% of total supply in Q4 2025.
Vacancy rates across Central London remain uneven by submarket, with the overall average falling to 8.52% in Q4 2025, down 189 basis points year-on-year and well below the five-year average of 10.6%.
The West End continues to record the lowest vacancy rate at 7.0%, despite a modest quarterly increase, and remains below its five-year average of 7.4%. Grade A supply has continued to be stripped out of the market, and areas such as Mayfair are seeing a Grade A vacancy rate as low as 0.3%.
In the City, vacancy declined to 9.7%, significantly below the five-year average of 13.3%. Grade A vacancy in the City reduced to 2.9%, with the City Core currently offering only 1.8m sq of best-in-class office space.
Looking ahead, a strong development pipeline scheduled for delivery in 2026 is expected to see vacancy rise. However, given the depth of occupier demand for high-quality Grade A space, seen by an active pre-let market across Central London, any increase is likely to be short-lived.
Shrinking supply and severe Grade A shortages continue to tighten Central London’s office market, underpinning rental growth despite near-term delivery risk.
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