London’s commercial property market is entering a defining phase. As 2026 approaches, the capital’s office landscape presents a paradox: vacancy rates remain close to 10 per cent — the highest in two decades — while prime rents in the West End have climbed beyond £150 per sq ft (Knight Frank, London Office Market 2025).
This “two-speed market” captures a widening divide between the demand for modern, energy-efficient offices and the growing obsolescence of older space.
According to Savills’ Central London Office Market Watch (Q4 2024), around 15 to 16 million sq ft of new office space is under construction — much of it built for post-pandemic needs such as flexibility, technology integration and ESG compliance.
Yet even as these new buildings lease quickly, landlords of secondary stock are offering generous rent-free incentives to fill space. The result: Grade A vacancy below 1 per cent in core postcodes, while older buildings in Docklands or outer West London suffer vacancy rates of 12.6% (Knight Frank).
Forces reshaping the market
Three currents define this new era:
- Hybrid work: companies are rightsizing, designing smaller but smarter spaces.
- Sustainability regulation: MEES rules require an EPC B rating by 2030, forcing a retrofit wave (UK Gov guidance).
- Economic realignment: stabilising interest rates may revive investor confidence through 2026.
Together, they’re fuelling a cycle of relocations, refurbishments and flexible leasing — particularly across finance, legal and tech. For business owners and facilities managers, this means 2026 is the moment to review workspace strategy. Whether upgrading to a greener HQ, consolidating locations or vacating temporarily during a refit, success will depend on careful planning and the right operational support.
A partner such as Removals & Storage Experts — offering coordinated office removals, secure storage and scheduled delivery — helps ensure moves happen smoothly.
The State of London’s Office Market
Behind the headline vacancy rate lies a more nuanced picture. London’s office stock totals millions of square feet, but demand is sharply polarised. The West End leads the pack, with prime rents reaching £150–£200 per sq ft and record leasing activity in Mayfair and St James’s (Savills Q4 2024).
By contrast, Canary Wharf continues to soften as major banks relocate to the City, pushing vacancy beyond 15 per cent (Financial Times, 2024).
The City of London itself remains resilient, achieving average rents around £100–£110 per sq ft with strong pre-let momentum on new ESG-compliant schemes (JLL, 2024).
Companies are prioritising quality over quantity. JLL notes that more than half of leases signed in 2024 were for spaces under 10,000 sq ft — a trend driven by SMEs and creative firms seeking flexibility — while large corporates consolidate into single, efficient headquarters. The result is a market rich in churn but short on expansion: movement, not growth.
Refurbishment has become the dominant form of development. Environmental targets and cost pressures make retrofitting more viable than demolition. Projects such as the Heron Tower green upgrade and British Land’s Broadgate revamp exemplify the shift towards high-spec modernisations (Property Week 2025). Savills estimates that roughly two-thirds of space under construction in 2025 is now refurbishment rather than new-build — a decisive turn toward sustainability.
What this means for your move: High-quality space is leasing fast, leaving little margin for delays. Planning early and coordinating professional office removals in London will help minimise downtime and ensure a smooth transition into refurbished premises.
The Rise of Flexible and Sustainable Workspaces
Flexibility and sustainability now underpin nearly every corporate real-estate decision. Hybrid work has shifted offices from occupancy hubs to collaboration spaces, and leasing models have adapted in kind.
Flexible offices are thriving.
CBRE reports that flexible-workspace operators accounted for one in five new lettings in central London during 2024 — up from 12 per cent before the pandemic.
Brands such as The Office Group, IWG/Regus and independent coworking providers in Shoreditch, Soho and Southbank are expanding again. Typical leases now span three to five years with break clauses, reflecting occupiers’ appetite for agility.
Sustainability has become non-negotiable.
Corporate tenants increasingly demand buildings rated BREEAM Excellent, LEED Gold or EPC A. The government’s tightening of energy-efficiency rules is accelerating the retrofit wave; buildings that fail to meet MEES standards could be unlettable by 2030 (UK Gov guidance).
Landlords are responding with smarter systems, greener materials and wellness-focused amenities such as terraces, gyms and bike storage.
These twin forces — flexibility and ESG — are reshaping occupier behaviour. Many firms now stage phased moves during refurbishments or store assets off-site while landlords complete upgrades. For operations teams, managing that logistics chain is challenging.
That’s where integrated services like Removals & Storage Experts’ collection and delivery storage become invaluable, providing professional packing, 24/7-monitored facilities and scheduled redelivery once fit-outs are complete.
What this means for your move: If you’re preparing for an ESG retrofit or hybrid-space adjustment in 2026, choose a storage partner that offers collection, secure holding and on-demand delivery. It keeps projects on track and your teams focused while your workspace evolves.
Beyond Offices: Industrial and Retail Resilience
While London’s office sector commands the headlines, other parts of the city’s commercial market tell a complementary story.
Industrial and logistics property remains one of the strongest-performing segments. Demand for urban warehousing and last-mile delivery hubs continues to outstrip supply, fuelled by e-commerce and the growth of quick-commerce services.
According to CBRE’s UK Real Estate Outlook 2025, prime logistics rents inside the M25 reached £25–£35 per sq ft by late 2025, with vacancy below 4 per cent.
Hotspots include Park Royal, Enfield, Croydon and Dagenham, where occupiers prize access to arterial routes and proximity to dense customer bases.
SMEs are also contributing to growth by taking smaller industrial units as flexible storage or micro-fulfilment spaces, sometimes paired with short-term office licences.
For removal and storage providers, this trend translates into cross-sector opportunities—businesses blending office and warehouse footprints increasingly need coordinated logistics for both environments.
Despite lagging other property types, the retail sector is stabilising. Strong demand from luxury and experiential brands is fueling a significant increase in prime retail rents in London’s West End, with Savills reporting year-on-year growth of 13.8% in Q2 2024 and 6.8% in Q2 2025.
Neighbourhood retail, especially food, wellness and service-led stores, remains resilient as hybrid work boosts weekday local footfall.
Developers are also delivering more mixed-use schemes, combining retail with flexible offices and residential space—another factor driving refurbishment and relocation activity across high-street corridors.
Economic and Policy Drivers to Watch
A number of macro and policy forces will determine how London’s commercial market behaves through 2026.
1. Interest Rates and Investment Cycles
After two years of monetary tightening, the Bank of England signalled in late 2025 that interest rates had likely peaked. Stability—or modest cuts—could stimulate a rebound in property investment.
Savills notes that prime City yields have plateaued around 5.25 per cent and West End yields near 4 per cent, suggesting that capital values have largely repriced and may begin to edge up if borrowing costs fall (Savills Q1 2025).
Greater clarity on inflation should also unlock financing for refurbishment projects that stalled under high-cost conditions in 2024, feeding new leasing opportunities from 2026 onward.
2. Business Rates and Operating Costs
The 2023 revaluation of business rates continues to ripple through corporate budgets. Prime West End occupiers have seen uplifts in rateable values, while some City and Docklands tenants enjoy partial relief after rental softening (Savills).
High operating costs, coupled with energy-efficiency upgrades, are pushing companies to rationalise space usage further—another incentive to relocate, sublet, or pursue flexible leases.
3. Sustainability Regulation
The government’s tightening Minimum Energy Efficiency Standards (MEES) remain the biggest structural driver of change. By 2027 commercial buildings must reach EPC C, and by 2030 EPC B, to be legally lettable (Energy Advice Hub).
Analysts estimate that more than 80 per cent of UK office stock falls short of that threshold today. Consequently, 2026 is expected to see a surge of green-refit projects and temporary tenant decants—creating sustained demand for full-service relocation and storage solutions.
4. Infrastructure and Regeneration
Transport and regeneration remain London’s secret weapons. The Elizabeth Line, fully operational since 2022, continues to reshape demand: areas such as Farringdon, Paddington and Canary Wharf have become magnets for occupiers seeking high connectivity.
A Crossrail study found that over 50 per cent of new Central London office supply since 2017 lies within a ten-minute walk of an Elizabeth Line station, and those assets achieve stronger pre-let rates than comparable projects elsewhere.
Meanwhile, new development zones—Nine Elms, White City, and Old Oak Common—are evolving into mixed-use business hubs.
For many firms, locating near these transit nodes can reduce commuting friction and align with sustainability and employee-wellbeing objectives.
What this means for your move:
When planning a relocation, factor in transport resilience, business-rate variation and EPC obligations. Choosing a future-proof location can save long-term costs—and working with a provider like Removals & Storage Experts ensures every stage, from packing to phased delivery, is handled efficiently.
Relocation and Storage Strategies for 2026
The shifting property landscape directly affects how companies execute moves.
As leases expire and refits ramp up, 2026 is likely to be one of London’s busiest relocation years in a decade.
1. Downsizing and Right-Sizing
Hybrid work has reduced office space requirements by as much as 50% per cent in some sectors. Many occupiers are consolidating into smaller yet higher-quality footprints, releasing surplus floors or entire buildings.
This trend often entails complex sequencing: disposing of redundant furniture, archiving records and moving IT infrastructure without disrupting business operations.
A professional mover such as Removals & Storage Experts can dismantle, transport and reinstall office systems within narrow weekend windows to avoid downtime.
2. Temporary Decant and Phased Moves
Refurbishments and ESG upgrades frequently require partial building closures.
Instead of halting operations, firms are adopting phased strategies—moving one department at a time or storing equipment between stages.
Using integrated solutions like RSE’s storage, collection & delivery service allows companies to:
- Store assets securely in climate-controlled, 24/7-monitored facilities.
- Request specific items for interim use through concierge delivery.
- Re-equip refurbished floors as each phase completes.
3. Multi-Site Flexibility
Some businesses are splitting functions across multiple smaller offices—an HQ in the City complemented by satellite hubs in Southbank or Stratford. Coordinating such distributed relocations demands meticulous logistics planning and transparent inventory management—core strengths of experienced commercial movers.
4. Secure Handling of IT and Sensitive Documents
Modern moves aren’t just about furniture.Data-heavy firms rely on safe migration of servers, PCs and confidential archives. RSE’s teams specialise in anti-static packing, cable management and compliant document transport, ensuring technology is up and running at the new site on day one.
Quick tip: Combining removals and storage under a single provider reduces the risk of delays and mis-communication. RSE’s combined removals and storage service covers packing, collection, secure storage and final delivery—ideal for projects spanning several weeks or sites.
Outlook for 2026 and Beyond
Analysts broadly expect 2026 to mark the start of a gradual stabilisation. Key forecasts include:
- Prime rents continuing modest growth of 3–5 per cent per year through 2027, driven by limited new Grade A supply (Knight Frank 2025).
- Vacancy rates easing from around 10 per cent toward single digits as refurbishments complete.
- Hybrid work stabilising at three to four in-office days per week, keeping total demand below pre-pandemic levels but sustaining strong appetite for high-quality space.
- Investment activity recovering as yields firm and sustainability upgrades enhance asset value.
Longer-term, London’s commercial stock will become leaner, greener and more technologically advanced.
Older buildings that cannot be economically upgraded are likely to convert to residential or life-science use, reducing total supply and supporting rent resilience.
For occupiers, that means 2026 is a strategic window: high-spec space is still accessible, but competition for the best buildings is tightening.
Conclusion: Turning Market Change into Opportunity
London’s 2026 commercial landscape is dynamic but full of potential. Hybrid work, ESG regulation and renewed economic confidence are reshaping how—and where—businesses operate.
Those who act decisively now can secure space that aligns with modern working styles and sustainability commitments.
Relocations and refurbishments no longer need to be disruptive.By engaging expert partners for planning, packing and interim storage, companies can manage moves with minimal interruption.
Whether you’re upgrading, consolidating or re-locating, strategic preparation and trusted execution make all the difference.
Ready to move your business forward?
Whether you’re upgrading to a greener HQ, downsizing for hybrid work, or relocating across London, Removals & Storage Experts makes it effortless. From professional office moves to secure, full-service storage with collection and delivery — we’ll handle every detail so you can focus on what’s next.
