Take-up across the south east office market (defined as the Western Corridor and the north and south M25 markets) totalled 720,000 sq ft in Q1 2017, according to Strutt & Parker.

The take-up figure for the first quarter of 2017 was broadly in line with the five year quarterly average of 708,000 sq ft but 8% below the corresponding quarter of 2016.

Strutt & Parker found that the office markets across the south east continue to be dominated by smaller transactions, with the 5,000 sq ft to 20,000 sq ft bracket accounting for 50% of deals undertaken in Q1 2017. The largest deal of the quarter was the letting to ASOS at Leavesden Park near Watford, where the online retailer acquired 75,000 sq ft, representing Q1’s only letting of over 60,000 sq ft.

Demand for space across the south east remains high according to Strutt & Parker, currently standing at 4.6m sq ft – of which 10% (462,000 sq ft) is under offer.

2016 saw rental growth in most south east locations as occupiers accepted that the best space has a premium attached to it. Q1 2017 saw new record rents being established in Hammersmith (£59.00 per sq ft), Maidenhead (£38.00 per sq ft), Reading (£36.50 per sq ft), Watford (£31.50 per sq ft) Redhill (£31.50 per sq ft) and Slough (£28.50 per sq ft).

Ed Smith, head of national markets office agency at Strutt & Parker, said: “The continuing trend of high levels of demand in the 5,000 sq ft to 20,000 sq ft size band isn’t having a detrimental impact on overall take-up levels, which remain in line with the five year average. Take-up levels are being bolstered by an increase in letting activity and the number of transactions being undertaken across the south east is increasing, 53 transactions were completed in Q1 2017, representing an increase of 26% on the five year quarterly average for number of transactions. This increase in take up in the 5,000 sq ft to 20,000 sq ft size range is also reflected in the identified demand figures and landlords are taking a flexible approach in their leasing strategies to accommodate this.”

Ed Smith concluded: “The end of 2016 brought the completion of a number of speculative schemes across the region and there are more to come throughout the first half of 2017. The take-up levels from the last quarter coupled with the strong rents being achieved is good news for landlords who are well-placed to capitalise on occupiers seeking high quality and well located space.”