No slowdown for Workspace

Workspace Group has reported strong demand for flexible office space in London, brushing aside concerns that the market has slowed.

Speaking after the company’s half-year results on Wednesday, Graham Clemett, chief financial officer at Workspace, said: “Right through the Brexit vote and afterwards we didn’t notice a major impact. It didn’t have a major impact on either enquiries or lettings.”

The results for the six months to the end of September reflect strong tenant demand, with like-for-like rental growth of 4.1%.

The news comes after IWG, the company formerly called Regus, issued a profit warning last month, citing “weakness” in London that chief executive Mark Dixon blamed on Brexit.

“Certainly there is an effect in central London, with fewer companies coming in and some preparing to move out. There is a malaise in the market,” he told Property Week.

Analysts said Workspace’s results suggested that IWG’s profit warning was not indicative of issues in the wider flexible offices market in London.

“There appears to be little sign of any meaningful slowdown in demand, as cited by IWG [suggesting its LFL declines are more company specific],” said analysts at Liberum in a note to investors.

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