The overall availability rate in central London rose from 2.7% to 3.2%, with 3.9% in the West End, 2.8% in the City and 2.2% in Docklands. But in all sub-markets vacancies are still at historically low levels. CBHP's Central London Market Index also shows that 90% of available space is now second-hand, a reflection of company rationalisation and portfolio consolidation in the face of the global slowdown.

Take-up across Central London fell by 11% during the second quarter to stand at 3.9 million sf. Although this figure is 26% down on the equivalent quarter last year, it is still a third higher than in the same period of 1999. Take-up of new space fell by 24%, but take-up of second-hand space actually rose by 11%, reflecting increased availability and a new cost consciousness among tenants.

At the same time as take-up of new space is declining, development activity is on the increase. The amount of space under construction in Central London has increased 50% since the beginning of 2001 to stand at 20.5 million sf. Over two thirds of the space under construction is concentrated in the City and Docklands, where availability is currently tightest. More than half the space currently under construction is pre-let, although in the latest quarter 75% of development starts were on a speculative basis.