Central London office space squeezed, says Derwent

London-focused office developer Derwent has said that space in the capital is being squeezed by low supply, higher rents, and strong demand.

In an interim management statement released this morning, it said that supply in central London fell for the seventh quarter in a row, and that there was “continued rental growth”.

This was particularly pronounced in the West End, it said, adding that this had helped push up capital values.

“Despite strong investor demand, transaction volumes fell due to a lack of supply,” it said.

It also announced the sale of five properties in Covent Garden for £68m to Capital and County Properties.

In addition, Derwent issued £175m worth of bonds to fund its development pipeline.