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Take-up in the EMEA office market rose in the third quarter of 2009, despite continued low leasing activity levels compared to 2008, according to CB Richard Ellis' latest EMEA office market research. Across the region, aggregate take-up in Europe increased slightly in the third quarter of 2009, but leasing activity will clearly fall short of last year's levels, probably by around 30%, CBRE says.

The report suggests expansion appetite is still limited as tenants renegotiate lease terms and corporates remain preoccupied with maximising the efficiency of existing space.

These trends continued to cause downward pressure on rents in the third quarter of 2009, with the CBRE EU-27 index of prime office rents down by 1.6%, although this is the smallest rental decline the index has recorded in the past year. Western European office rents in particular showed signs of stability or only marginal reductions, with steadiness noted in core markets such as Paris, Frankfurt and London’s West End. Markets such as Madrid, Zurich and Dublin remain notably weak, with overall rental levels likely to remain subdued in these areas, at least in the short term. Moscow was the most active letting market in the third quarter, but CEE markets more generally are among those seeing downward pressure on rents.

The patterns observed in London suggest the market is now emerging from a period of decline. A 61% quarter-on-quarter rise in take-up levels was noted in London in the third quarter, as well as a sharp rise in the volume of space under offer, suggesting there is momentum in the market that would be expected to feed through into leasing levels in the fourth quarter.

Richard Holberton, director, EMEA Research, CBRE, says: 'Having entered the downturn earlier and more steeply than others, the UK in particular is now beginning to show signs of improvement ahead of other markets. Since the largest non pre-let property transaction ever seen in the City of London - Nomura's 46,451 m² acquisition at Watermark Place in August - there has been a pick-up in activity. From an occupiers perspective, this reflects a growing view that the market is unlikely to get much better than it is now - incentive packages and rental terms look set to tighten next year, creating less choice and a shrinking window of opportunity for occupiers.'

On the supply side, the EU-27 office vacancy rate saw the sharpest rise of the year, reaching 8.7% in the third quarter. However, vacancy trends are beginning to show much greater local variation; London and Moscow saw vacancy reductions this quarter, but this was outweighed by increases in the Spanish markets as well as in Paris and Central and Eastern Europe.