Global office markets face supply shortages in London and Perth

Major commercial real estate markets in London and Perth are experiencing significant tightening in office space availability due to high demand and limited supply.

In London, small and medium-sized enterprises (SMEs) are facing a structural squeeze. While overall leasing activity remains healthy, transactions for spaces under 10,000 square feet fell 25% in the first quarter of 2026, reaching their lowest level since 2021. This scarcity is driven by large corporations competing for high-quality, boutique office spaces and a thin supply pipeline, with new completions for 2026 expected to be down approximately 40% year-on-year.

Similarly, Perth’s CBD office market is seeing a sharp decline in vacancy rates. Following a 15.4% vacancy rate in the first half of 2026, experts forecast that vacancy could drop to approximately 8% by 2030. This trend is attributed to strong tenant demand and an effectively non-existent supply pipeline, as no new office developments are expected to complete before 2030.