London Coworking Market – Less Demand, Bigger Transactions in 2024

Feb 10, 2025 · 3 min read

The London coworking market in 2024 has exhibited an interesting dynamic—while overall demand has declined, transaction levels have surged, indicating a shift toward higher-quality deals. According to research from Savills and its flexible office platform Workthere, total take-up of flexible office space across the UK reached just over 98,400 m2, marking the highest level since 2019 and a 12% increase from 2023.

Quality Over Quantity: A Shift in Demand

Despite an overall 10% year-on-year decline in demand, transaction volumes rose by 35%, suggesting that businesses looking for flexible office space are more committed and selective, observes Workthere. Additionally, there was a notable 7% increase in businesses entering new markets and a 33% rise in businesses relocating from their current space. This trend underscores a continued “flight to quality”, says Workthere, with more organizations prioritizing premium workspaces over merely affordable options.

Pricing and Occupancy Trends

While average desk prices in London remained stable at €900 per desk per month. Outside of London, there was a significant 17% price increase, with rates reaching €445 per desk per month. This divergence indicates a stronger demand for high-quality workspaces outside the capital.

Occupancy rates in the coworking sector in London remained at a solid 86%, reflecting consistent operator stability. However, outside of London, occupancy fell to 82%, possibly due to price increases causing some customers to reconsider their workspace choices.

Longer Contracts and Stronger Commitments

One of the most notable shifts in 2024 was the increase in contract lengths. The average initial term length grew from 13.1 months to 15.8 months, adds Workthre, a direct result of more managed space deals that typically come with extended contract durations. This trend would suggest a growing preference for longer-term stability in the flexible office market.

Outlook for 2025

According to Tom Leahy, co-head of Workthere UK, quoted in Costar, “2024 reflected a year of stability for the flexible office sector with take-up remaining robust across the board from operators. Whilst demand was down at a headline level, this appears consistent with the wider office market, and the fact that transactions increased demonstrates an improved quality of demand over the course of the year.”

Looking ahead, Faith Robins, head of occupier advisory at Workthere, believes the market is well-positioned for continued growth. “We expect the market will continue to evolve this year with operators and landlords offering a greater diversification of products and amenities for customers.”

With stable pricing, increasing contract lengths, and a higher quality of demand, the London coworking market remains resilient and poised for further strategic expansion in 2025.