Workspace Group has said it expects more large firms to vacate its London properties in the months ahead, as shifting working patterns and cautious business sentiment continue to weigh on occupancy levels.
The flexible office space provider reported a 0.3 percent dip in occupancy between April and June, bringing overall occupancy to 82.2 percent. The decline reflects ongoing departures by larger tenants, particularly in areas such as Camden, where further exits are anticipated.
Chief executive Lawrence Hutchings said the company is focused on stabilising occupancy and will take a pragmatic approach to pricing while continuing to invest in refurbishments and targeted marketing.
“Our immediate focus remains on stabilising and, over time, rebuilding occupancy,” he said. “We are taking action to retain and attract more customers, including upgrades to several locations and a localised marketing push where we have lower uptake.”
Workspace, which owns around 65 properties across London and the South East, currently provides space to more than 4,000 businesses. It has also moved to offload underperforming assets, with recent disposals in Brentford and Ladbroke Grove bringing in a combined £15 million.
The group acknowledged that wider economic uncertainty has impacted confidence among some tenants. Despite signs of recovery in midweek footfall, the long-term shift toward hybrid work remains a key factor. Official figures show that 28 percent of the UK workforce is still operating in a hybrid model, combining remote and in-office days.
This aligns with broader market commentary, including British Land’s recent update that midweek occupancy across its central London portfolio has returned to pre-pandemic levels. However, variability across sectors and office types means demand for flexible space remains uneven.
Rents across Workspace’s portfolio totalled £138.6 million at the end of the quarter, slightly lower than in the previous reporting period.
For business owners, particularly those considering office needs in the capital, the evolving market offers both risks and opportunities. Cost pressures, location flexibility, and employee expectations are all influencing decisions around space requirements. Workspace’s response reflects the broader challenge for office providers: adapting portfolios and pricing models to meet the needs of a changing client base.
