London businesses could save £24k per annum by relocating their office to a different borough

London firms could save up to £2,000 a month by changing their office location, according to a new study by office interior design and build firm, Peldon Rose.

With more companies adopting hybrid work, finding affordable yet functional office space is crucial in order to support talent retention, teamwork and company culture.

The study analysed data from Zoopla to determine the most, and least, expensive locations to rent an office space across London and the UK.

The British Council for Offices recommends allocating between 10-12m2 per employee. This recommendation was updated in 2022 to reflect the changing nature of offices to promote productivity and wellbeing, however, Will Kumbu, Project Director at Peldon Rose, adds “it’s important to be flexible with the amount of space you allocate for each employee based on your industry, culture and workplace population density”.

Most affordable places in London to rent office space

Offices in Bexley, the most affordable London borough, cost an average of £255 per m2 each year, £3,063 per employee, making it ideal for cost-conscious businesses while still maintaining good transport connections to the centre of London.

Lewisham follows with £296 per m2 annually, or £3,552 per employee, providing a slightly higher but still competitive rate. GreenwichBarking and Dagenham are close, at £305 and £306 per m2 annually (each around £25 per m2 p/m), offering a mix of affordability and accessibility.

Kingston upon Thames rounds out the list at £317 per m2 annually (£3,660 for each employee), providing a balance of lower rent with its appeal as a well-connected borough.

The most expensive places in London to rent an office 

Westminster tops the list, with an annual rate of £2,278 per m2 (£27,336 for each employee), reflecting its status as a central hub for government, business, and high-profile companies. That’s over £2,000 more than Bexley, the cheapest borough for renting office space in London.

The City of London, the financial heart of the city, follows closely at £1,941 p/m2 each year (£23,292 per employee). Camden, at £1,270 per m2 p/m (£15,240 per m2 annually), is a creative and commercial hotspot, driving higher rent prices.

Havering and Waltham Forest, both on the outer edges of London, are still relatively expensive compared to most other areas, with rents at £1,128 and £1,099 per m2 annually, reflecting growing demand for office space in suburban boroughs.

The cheapest Cities in the UK to rent an office 

Bradford and Swansea share the top spot with an annual office rental rate of £135 p/m2 (£1,620 per employee), making them the most affordable cities for businesses to rent a physical office.

Blackpool follows with £145 per m2 annually (£1,740 per employee), while Stoke-on-Trent offers office space at £153 per m2  per year(£1,836 per m2 p/m).

Newport, Leicester, and Southend-on-Sea are tied at £172-£173 per m2 annually (£14 a m2 each month), providing competitive rates for office space in these cities while still offering solid infrastructure and business opportunities.

Interestingly, the “northern powerhouse”, Manchester, is in the middle of the table, in 13th position. Businesses wanting to open an office there can expect to pay a monthly average of £18.92 per m2, or £2,724.84 a year per employee.

The most expensive cities in the UK to rent an office 

When looking outside the capital, Bristol leads with an annual rate of £682 per m2 (£8,184 for each employee), reflecting its status as a vibrant business hub in the southwest. That’s a staggering £547 more than Bradford or Swansea, the cheapest cities for renting office space in the study.

Derby follows closely at £669 per m2 annually (£8,028 per employee), driven by its strong industrial and tech sectors. Birkenhead, at £470 per m2 annually (£5,640 per employee), is significantly cheaper but still ranks third, while Belfast, the capital of Northern Ireland, offers office space for £420 m2 annually (£5,040 per employee).

Liverpool rounds out the list with office space costing £394 per m2 annually (£4,728 per employee), maintaining its appeal as a major northern city with competitive office rental prices.

Offering some advice for businesses on how to navigate office relocation, Kumbu said: “There are many different reasons why you may need to relocate your business, from outgrowing your current space or wanting to save business costs. 

“At the core of every decision should be your employees. The office should be an inviting space where they want to make the commute and spend their time.

“Increasingly we’re seeing that people travel into the office to access and undertake activities outside of their primary working day, such as access to their gym, or evening plans such as seeing friends or a shopping trip. This makes it important to fully understand their needs – both within the working day and outside it – in order to make the right decision when it comes to office relocation.”

For more information on office relocations click here.