Central London is on course for a record year of office completions in 2026, yet the number of new schemes breaking ground has collapsed. This article sets out what the latest Savills data shows about take-up, rents, supply and the development pipeline, and what it could mean for businesses that need London space.
The figures come from two Savills publications: its Central London Market Watch for August 2026, published on 30 September 2026, and its Market in Minutes for September 2026, published on 19 October 2026.
How strong is Central London office demand right now?
Demand is holding up, according to Savills. Central London take-up reached 557,416 sq ft in August 2026, which was 35% lower than July but 10% above August 2025. The City accounted for 373,298 sq ft of that total and the West End for 184,118 sq ft.
The year-to-date picture is steadier. Savills reports year-to-date take-up of 6.13 million sq ft, 2% ahead of the same period last year, 8% above the five-year average and broadly in line with the ten-year average. By the end of the third quarter, Savills says, Central London take-up was 6% above the ten-year average for the period.
The West End has been the livelier of the two markets this year. Savills puts West End year-to-date take-up at 2.79 million sq ft, 27% higher than at the same point last year.
Active requirements, meaning the space that occupiers are currently searching for, stood at 14.46 million sq ft in August. That was 5% lower than the previous month but 10% above August 2025.
Why are Grade A rents rising so quickly?
Because occupiers overwhelmingly want the best buildings. Savills says Grade A space made up 93% of activity in August, and 95% in the City. Demand is concentrated at the top of the market, so rents for that stock have moved furthest.
According to Savills, average Grade A rents in August were:
| Market | Average Grade A rent (August 2026) | Change on a year earlier |
|---|---|---|
| City | £86.26 per sq ft | Up around 20% |
| West End | £134.17 per sq ft | Around 42% higher |
These are averages across Grade A deals, not the headline prime rents often quoted for trophy buildings, so they are a useful gauge of what a typical modern-office occupier is paying.
A worked example: what the gap means for a 10,000 sq ft occupier
Illustrative arithmetic helps show how much location can matter. For a business taking 10,000 sq ft at the August average Grade A rents:
- City: 10,000 × £86.26 = £862,600 a year
- West End: 10,000 × £134.17 = £1,341,700 a year
- Difference: £1,341,700 − £862,600 = £479,100 a year
This is a simple rent-only comparison. It ignores incentives such as rent-free periods, service charges, business rates and fit-out costs, all of which vary by building and lease. The point is scale: the West End premium in this example is nearly £480,000 a year before any of those extras.
What is happening to vacancy and supply?
Supply is tightening gradually. Savills reports that Central London availability was 18.16 million sq ft in August, down 1% on the month and 9% on a year earlier. The Central London vacancy rate fell to 7.0%, around 60 basis points below its level a year ago.
A 7.0% vacancy rate may not sound especially tight. The picture is more pressured at the top of the market, where most of the demand sits. Savills notes that prime availability in core locations is shrinking, and the Grade A share of take-up shows where occupiers are looking. Older, secondary buildings make up a good deal of the headline vacancy figure, and they are not what most active searchers want.
Space already agreed is also a signal. Savills says space under offer in August was 2.51 million sq ft, down 18% on the month and 26% below last year. In investment, Central London office assets under offer totalled £3.8 billion at the end of the third quarter, which Savills puts 37% above the ten-year average for this point in the year.
Why is a record completions year not the whole story?
Savills expects Central London completions to reach a record 7 million sq ft this year. On its own, that might suggest ample new space. The rest of the pipeline data points the other way.
Savills reports that:
- Central London development starts totalled 2.6 million sq ft at the end of the third quarter, and full-year activity is expected to be the lowest in more than a decade.
- First-half starts were 39% below the ten-year first-half average.
- No new ground-up office schemes started in Central London in the third quarter, and fewer than 250,000 sq ft has commenced so far this year.
- One in five Central London schemes is delayed by more than six months against third-quarter 2025 expectations.
A completion is the end of a process that began years earlier. This year’s record reflects decisions taken before the current slowdown in starts. What matters for the next few years is the thin line of schemes that follows, not the burst now arriving.
What does the future pipeline look like?
Savills says 15.3 million sq ft is under construction nationally across the commercial sector, with 64% due for completion by the end of 2027 and 25% already let.
The Central London forward view is more uneven. Savills reports that the so-called Big Six markets will see deliveries in 2027 and 2028 of about 1.05 million sq ft a year, roughly 32% below the five-year annual average. It also says 43% of the 26.7 million sq ft scheduled for completion across Central London by 2030 has yet to start.
The second figure deserves a careful reading. Applying 43% to 26.7 million sq ft gives roughly 11.5 million sq ft of space that is pencilled in for delivery by 2030 but not yet under way. Given the delay data, and given that starts are at multi-year lows, some of that space may arrive later than planned or not at all. That is an interpretation of the numbers rather than a forecast made by Savills.
Another 4.1 million sq ft is undergoing demolition, according to Savills, which points to future replacement schemes rather than near-term supply.
Are refurbishments replacing new-build offices?
For now, largely yes. Savills says the Big Six are recording their lowest ever level of new development starts, with extensive refurbishments making up 91% of starts.
Refurbishment is a different proposition from ground-up development. It can be quicker and may carry less embodied carbon than demolition and rebuild, though the specifics depend on the scheme. It also interacts with regulation: owners upgrading older buildings will want to keep an eye on the energy-efficiency requirements covered in the article on the 2031 EPC B plan for London’s commercial landlords.
Savills does not say in the publications used here why starts have fallen, and this article does not attempt to assign a single cause. What the data does show is a market where fresh ground-up supply is scarce and upgraded existing buildings are doing more of the work.
What could this mean for London occupiers and landlords?
The data does not hand anyone a ready-made strategy, but a few patterns follow from it.
For occupiers, the combination of rising Grade A rents and a thinner future pipeline suggests that the best space in prime locations may be harder to secure at short notice. Businesses with lease events in the next few years may want to understand their options early. The wider backdrop for these decisions is covered in the earlier pieces on what is happening to London’s commercial property market and how the office market is adapting to hybrid work.
For landlords, the numbers favour owners of well-located, high-specification stock, while older space with weaker credentials faces a more demanding market. The yield data adds a note of caution: Savills reports that the average prime yield across office and industrial sub-sectors rose 25 basis points to 6.0% in September, the largest monthly outward move since November 2023. Higher yields mean investors are asking for more return for the risk they are taking, which can shape which refurbishments and developments get financed.
Lease terms also matter. New and renewal leases in England and Wales can no longer rely on upwards-only rent review clauses, as explained in the article on the ban on upwards-only rent reviews. That affects how rising market rents flow through to rents at review dates, though it does not stop market rents themselves rising.
What to watch as 2027 approaches
Three indicators will show whether the squeeze deepens. The first is whether new starts recover from their current lows, particularly ground-up schemes. The second is whether the proportion of delayed schemes grows. The third is whether the sharp rise in Grade A rents continues or levels off as record completions are absorbed.
The data so far describes a market in transition rather than a settled picture. Demand is concentrated, supply of the best space is tightening, and the 2026 completions peak sits ahead of a quieter delivery period. Where the pipeline narrows, tenants, landlords and investors will all feel it in different ways.
Conclusion: a peak in completions, a trough in starts
Central London’s office market in late 2026 is defined by a contrast. Record completions are arriving this year, while starts are at their weakest in over a decade and refurbishment dominates what is being built. Grade A rents have risen sharply, vacancy has edged down to 7.0%, and demand remains concentrated in the highest-quality buildings. Whether the contrast eases will depend on how quickly new schemes restart.
This article is general information, not financial, legal or property advice. Market data changes frequently, and figures are as reported by Savills at the dates stated.
Sources: Savills
