Yesterday, BusinessLDN was pleased to convene the inaugural Commercial Property Pulse, a new series bringing together senior industry voices to discuss London’s commercial property market, hosted by Delancey.
The session opened with an overview from Simon Brown, Head of UK Occupational Markets Research (CBRE), who set out a clear topline picture of current market dynamics: leasing activity remains strong and is increasingly driven by expansion; second-hand vacancy is beginning to ease; and the development pipeline is thinning as supply continues to lag demand. Perhaps most interestingly, Simon questioned whether the so-called “flight to quality” has been misdiagnosed, suggesting it may in fact be better understood as a flight to core locations. Taken together, these trends point to a market that remains resilient but increasingly constrained as demand continues to outpace available supply.
Our panel session brought together Julie Ennis, Senior Director at CBRE; Dan Dawe, Head of Investment at Delancey; Katie Stewart, Executive Director for Environment at the City of London Corporation; and Nikki Dibley, Planning Director at Helical, offering a timely snapshot of how the market is evolving and how they are all adapting to it.
While much of the policy and industry debate over the past year has rightly focused on housing delivery, London’s commercial market continues to perform strongly. It remains a vital engine of jobs, investment, and growth – underpinning not only the capital’s economy, but the UK’s wider global competitiveness.
However, the discussion also reflected a more complex and fast-moving backdrop. Rising construction costs and wider macroeconomic uncertainty are weighing on viability and shaping delivery decisions, with clear implications for future supply. The result is a market that, while still robust, is clearly at an inflection point.
We heard a range of perspectives on how these dynamics are playing out in practice. Dan Dawe emphasised that Delancey remains actively invested across London, pursuing opportunities despite ongoing macroeconomic headwinds and citing the city’s enduring appeal as a key reason for its continued commitment. He also highlighted the recent influx of AI and tech companies into London, and the implications this is beginning to have for office demand. Julie Ennis echoed this, reiterating London’s position as a key entry point into Europe for many organisations, particularly amid the recent surge in tech occupiers, and highlighting how occupier demand is evolving, with a stronger emphasis on location and amenities.
Nikki Dibley reflected on the challenges of delivering new development in the current environment, noting that prioritising investment in interventions with visible, tangible benefits can be critical to creating places that remain attractive to occupiers. Katie Stewart built on this, outlining the City of London Corporation’s role in working with applicants to help ease viability challenges where possible, while also curating a place that better reflects evolving occupier demand through diversification and placemaking.
Against this backdrop, the discussion reinforced Simon’s earlier observation that the market is less about a “flight to quality” than a sharpening focus on core locations. As development pipelines tighten and supply continues to fall short of sustained demand, pressure is likely to increase, pushing occupiers into a wider set of sub-markets and reshaping demand patterns across London.