Empty offices in City up 46 per cent

The amount of vacant office space in the City of London has jumped 46% in the last year.

Commercial property agency NB Real Estate today said 7.8 million square feet of office space is lying empty, against 5.4 million a year ago.

Lack of demand from new tenants has driven rents down 11.5% from £65 per sq ft to £57.50 while the value of office blocks has crashed by 30%.

Peter Trinder, NB's head of central London investment, said cash-rich buyers are now waiting to snap up bargains.

"Amongst all the apocalyptic headlines and panic there are long-term investors including sovereign wealth funds who are sitting on growing piles
of cash they have to invest," he said.

"The old adage has always been to buy when there is blood in the streets — when sentiment has fully turned against an asset class.

"With the collapse of Lehman Brothers, Bear Stearns and the sale of Merrill Lynch, these funds are asking whether things can actually get much bloodier."