Alastair Elliott, partner and head of Knight Frank's business space team, said 'In contrast with previous cycles, developers and investors appear to have so far responded rapidly to fluctuating economic conditions. The development market is slowing with new space expected to reduce further during the remainder of the year.'

During the early 1990s speculative development activity continued apace before many big-name property players would admit that the market was in a tail-spin. By then it was too late and many companies folded leaving vacant property and plunging rents. It took almost six years for the market to pick up again.

The impact on existing M25 office property looks to have been slightly more muted according to Elliott who said, 'Activity levels remain healthy without the strength of 12 months ago.' The average size of deal is 19,785 sq ft this year as against 26,210 last while enquiries are down by 25 per cent.