London commercial property market 'set for headline rents'

Headline rents are expected to be seen in London's commercial property market this year, according to a new study.

Research by Savills revealed that rents in the office market will reach £56 per sq ft in 2010 and may hit £98 per sq ft in the West End area by 2011.

The consultancy firm claimed that the increases were due to a decline in availability of new stock, as a period of record low levels of development completion gets underway in the area.

Peter Thursfield, director of Savills City Agency, said: "We anticipate a firm recovery in the City market this year closely followed by the West End in 2011.

"We do not expect a boom in take-up as uncertainties in taxation, regulation and public spending will continue to hang over the wider economy at least until post budgets and election."

Last week, separate research from Savills revealed a moderate increase in overall commercial development activity was seen in December.