Occupier demand increased 51% compared to the same period last year, with 3.2 million sq ft of active requirements registered. This has not yet been reflected in leasing volumes, with activity for the first half of 2011 down 20% on H1 2010. Supply fell to 12.2 million sq ft, down 5.8% compared to the equivalent period last year. Grade A supply fell to its lowest level since 2008, reflecting a vacancy rate of 5.9%. In West London Grade A supply fell to its lowest level in nine years, reflecting a
vacancy rate of 3.3%.

Investment activity picked up over the first half of 2011 with £805 million traded. Prime yields stabilised at 6.50% in both the Thames Valley and West London. We expect investment activity to increase going forward, as improved investor sentiment due to the current pricing levels drives interest outside of London.  

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