The company recently reflected on its latest financial figures and noted that while growth in property prices has slowed, demand for high-quality office space to rent in London remains strong.
Economic uncertainty across Europe has seen lending activity weaken, which in turn has meant less speculative development and greater demand for prime office space to rent in London’s financial districts, experts explain.
Chris Grigg, British Land’s chief executive, said: “Valuations have risen more slowly in this quarter, reflecting in part a more uncertain economic outlook.”
“Valuations won’t grow as quickly. But in terms of rental growth, we’re quite optimistic. It’s a function of ‘not much supply’” he is quoted as saying in the Guardian.
British Land is among the largest commercial property investors in the UK, and its London office space leasing activity in recent months has helped to boost its overall occupancy rates to 97.8 per cent.
Earlier this month, the company revealed its plans to develop 700,000 sq ft of office space and trading floor on the Broadgate Estate in central London.
Editor’s notes: Following the pandemic, there was an increase in demand across most UK cities for high-quality office space with amenities that improve employees’ well-being, such as gyms, restaurants, and wellness rooms, as well as for spaces with strong ESG credentials, including accreditations such as BREEAM and LEED.
Offices that met these requirements tended to be new and built to a high specification, and attract prime office rents.
However, in the majority of markets, ongoing and new office building developments slowed down during the pandemic, and following the pandemic, construction costs increased, and the supply of materials became inconsistent due to geopolitical and economic events.
The increased demand for prime office space, together with decreased supply, put pressure on prime rental rates upwards.
The ‘Big 6’ regional office markets are Birmingham, Bristol, Edinburgh, Glasgow, Leeds and Manchester.
In 2022, prime office rent in Birmingham reached £41 per square foot per year. In Bristol city centre in the same year, headline rent reached £42.50 per square foot. The best quality office space in Edinburgh reached £39.50 per square foot. Glasgow office space of the highest quality was quoted at £35.50 per square foot. Prime office space in Leeds reached £36.00 per square foot, and the best office space in Manchester reached £38.50 per square foot.
Prime rents reached £130.00 per square foot in London’s West End. Prime office rental rates in the City of London reached £72.50 per square foot, and prime rents in East London reached £55.00 per square foot.
Research conducted in June 2026 found that London office space take-up hit 12.1 million square feet across 1,400 deals in 2025, the capital’s strongest year since 2019.
In Q1 2026, the average prime rent for the City rose to £130.80 per square foot, which was up 40 per cent on Q1 2025. A new record top rent of £160 per square foot in the City, Savills reported.
In the West End, average prime rent held steady at £165.00 per square foot, down 0.7 per cent on Q1 2025, with the top rent achieved over the quarter standing at £201 per square foot, following SoftBank’s acquisition of the 1st floor at 77 Grosvenor Street in Mayfair in May.
Prime office rents in East London, including Canary Wharf, Docklands and Stratford, stood at £57.50 per square foot.
It was also found that JLL reported in Q2 2026 that office take-up by way of lettings in 2025 across the Big 6 cities was 3.9 million square feet, below the five-year average of 4 million square feet.
JLL’s research also highlighted 3.75 million square feet of demand from specific occupiers already in the market, including five active enquiries exceeding 100,000 square feet, leading the firm to forecast that 2026 would be a year of renewed momentum for the market.
The firm stated that occupier sentiment was improving and office employment growth was forecast to outpace the UK average across all six cities up to 2030.
It was noted that high demand, against a backdrop of tightening supply exacerbated by economic turmoil from the conflict in Iran in Q1 2026, would put continued upward pressure on rents.
JLL predicted that prime office rents across all Big 6 cities would reach £60 per square foot per annum by 2030, equating to an average rental growth of 4.58 per cent per annum.