UK London Office Marketbeat Reports

For the data behind the commentary, download the full Q1 2025 UK London Offices Report.

READY, SET, LET – THE RISE IN FITTED OFFICES

Fitted offices are becoming increasingly common, a trend that is redefining how businesses approach their office needs. Our analysis of data from Kato, 46% of all buildings with availability in Central London have at least some of their space marketed as fitted, excluding spaces smaller than 5,000 sq ft. When these smaller spaces are included, the percentage rises to 55%. This indicates a substantial portion of the market is moving towards ready-to-use office spaces.

This evolution comes as companies come up against increasing occupational costs – with the combined impact from rising rents, higher service charges and record high fit out costs. Our London Moves 2025 report also demonstrated that companies are taking more space and of better quality – raising costs further. Additionally, business rates are also set to rise by an estimated 38-49% for Central London office occupiers following the 2026 revaluation. All of these factors are putting pressure on occupiers to minimise the cost of moving offices.

One way to do this is to move into fitted space. This avoids the significant upfront capital expenditure of fitting out the space, which was found to be at a record high average of £206 psf for a medium-spec finish and up to £306 psf for high spec in our Fit Out Cost Guide. Additionally, fitted space means that occupiers can also move into the space immediately, minimising any costly double overhead periods where their former and new office leases overlap, as well as being able to enact any growth strategies quicker.

From the landlords’ perspective, fitting out space does increase risk. However, having even a single Cat B floor can help lower the void periods across the whole building, with tenants better able to visualise the space. There is also the opportunity to capitalise on a middle ground, where Cat A space is fitted out by the landlord in partnership with the occupier, spreading the cost over the term of the lease. This allows the occupier to avoid the cap ex commitment, and allows the landlord to increase their income returns – a win-win.