A growing number of companies in London are reversing earlier trends of downsizing, as new data show a significant uptick in office expansions across the city, signalling a broader retreat from remote work and a resurgence of in-person operations.
According to data compiled by property broker Cushman & Wakefield, 78% of established businesses that moved offices in central London in 2024 took up more space than before, accounting for a total of 4.1 million square feet in expansion. After subtracting reductions by other firms, the city still recorded a net office space expansion of 3.27 million square feet, up 75% from the previous year and the largest such increase since 2019.
This shift marks a significant turnaround from the early days of the COVID-19 pandemic, when companies scaled down operations and re-evaluated the role of physical offices. At the time, former Morgan Stanley CEO James Gorman famously predicted that there would be “much less real estate” in the future, but while that forecast rang true in the immediate aftermath, new trends suggest the pendulum may now be swinging back.
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“First, it was just less, then it was less but better. Now it is more and better,” said Ben Cullen, Head of UK Offices at Cushman & Wakefield.
Major institutions are leading the shift, as Morgan Stanley recently chose to maintain its presence in Canary Wharf after years of exploring alternatives. While Deutsche Bank has opted to stay in its current space, and JPMorgan Chase is reportedly in talks to expand within the financial district, HSBC, which previously announced plans to cut back, is now reassessing whether it has sufficient space as employees return to the office in greater numbers.
Analysts say the changes reflect a broader rebalancing.
“Some of the right-sizing measures we saw in the post-pandemic period are correcting,” said Kiran Patel, Head of London Office Research at Cushman & Wakefield.
The City of London, known for its dense transport network and central location, is benefiting most from the renewed appetite for premium space as a record 339 leases for office spaces exceeding 5,000 square feet were signed in the City in 2024, accounting for 64% of all deals, a historic high.
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Notably, firms are also reluctant to relocate far from their current locations, prioritising employee commutes as they work to encourage more staff to return in person. This growing demand, combined with limited new supply, is pushing up rents in central areas. Experts say upcoming property tax increases will further raise occupancy costs, potentially directing more attention to peripheral zones like Canary Wharf, where rents remain comparatively lower.
Meanwhile, new data from CoStar Group shows that the UK’s national office vacancy rate fell for the first time since the pandemic began. The rate dropped to 8.6% in March 2025 from 8.7% at the end of 2024, a modest shift, but a notable departure from the 12-year high reached last year.
The developments underscore a growing belief among employers that physical office space remains a central component of company culture, productivity, and collaboration, despite earlier predictions to the contrary.
