King Sturge's latest UK office enquiries data hint that recent buoyancy in office demand may not be sustained. Figures for the quarter just ended show a decline in both the level (-12% quarter-on-quarter) and the number (-14%) of enquiries recorded across the office network.
This is disappointing after a promising start to the year, though it repeats the pattern of the last 18 months when enquiries have failed to shift up from their trough.
"In the past, movement in enquiries has usually been reflected in take-up a few months later," according to Andrew Burrell, Head of Office Research at King Sturge. "But since mid-2009, office take-up has recovered strongly ahead of any sign of an upturn in enquiries. The concern is that much of the recent rise in demand could be transient and may fade in the harsher post-election climate."
Not all UK centers have fared badly. The capital's recovery continues to show in the data, with City and West End enquiries well up on a year ago, while the South East is also seeing healthier conditions. Outside of this, Newcastle, Edinburgh, Glasgow, Nottingham and, more recently, Bristol have shown signs of recovery.
But, overall, the concern will remain that until national activity is underpinned by a sustained improvement in requests for new space, there is a danger that it could fizzle out.
Source: King Sturge