Derwent says London demand returns as tenants pay premium

London office landlord Derwent said demand for space had resumed after the Covid pandemic, with tenants prepared to pay premium rents for space.

The company on Thursday said London had become “busy again” after the move to home working during pandemic lockdowns.

“With the shortage of grade A space becoming more apparent, many occupiers are prepared to pay premium rents for space that meets their requirements,” Derwent said, adding that it had leased out about 65,000 sq ft of space so far this year.

New lettings were worth £3.9m in annual rent, up 8.2% on the estimated rental value of the space in December last year. Leases worth another £3.3m in income were also under offer, Derwent said.

In a separate announcement, Derwent said it had bought the site of the Moorfields Eye Hospital and the UCL Institute of Ophthalmology for £239m.