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London hedge funds seek prime Mayfair offices amid shrinking supply
Knight Frank estimates 1.8 million square feet of niche financial office demand is active across 33 searches, with only about 342,000 square feet under offer or in negotiations.
London hedge funds, private equity firms, and other specialist investment managers are moving earlier and widening their search areas as demand builds for prime office space in Mayfair and St James's, according to Knight Frank, as cited by Hedgeweek.
Knight Frank said it is tracking 1.8 million square feet of active requirements from niche financial occupiers across 33 searches, up 5.9% from a year earlier. Hedge funds account for 252,000 square feet of that demand and private equity firms are seeking an additional 235,000 square feet, while only around 342,000 square feet, or 19% of the total requirement, is currently under offer or in negotiations, leaving roughly 1.5 million square feet still searching for suitable premises.
The shortage is particularly acute in Mayfair and St James's, where Knight Frank reported new-build vacancy of 0.4%, versus 1.5% across the wider West End. The firm said there is no immediately available new-build or refurbished building large enough to accommodate an 80,000-square-foot requirement at the end of the second quarter, and that half of the London submarkets it tracks have new-build vacancy rates of 1.0% or less.
Hedgeweek also reported that leasing activity during the first half of 2026 was lower than in recent years, with niche financial firms completing 32 transactions totaling 343,265 square feet. That represented a 59% decline in total space leased and a 41% drop in deals versus the first half of 2025, which Knight Frank attributed largely to the absence of very large transactions that had boosted earlier figures.