Oxford office market roundup
Take-up outlook remains positive despite slower start to 2026
Office take-up reached 32,000 sq ft in Q1 2026, representing a 23% increase on Q1 2025 but remaining 48% below the five-year quarterly average. There were no office transactions over 10,000 sq ft recorded across the wider Oxford market in the first quarter, partly explaining the lower levels of take-up. The largest transaction was Childbase Partnership leasing 9,900 sq ft at Building 9850, Arc Oxford, where a nursery will be operated.
There was only one Grade A transaction recorded: Mishcon de Reya acquired 3,000 sq ft at Red Hall, Oxford North. This represented the first letting secured at the new best-in-class scheme.
Looking forward, an improved take-up performance is expected in Q2 with 68,000 sq ft under offer, and a number of larger deals close to going into solicitors' hands.
Venture capital funding environment improving
Take-up across the office market in recent years has often been linked to the venture capital (VC) funding environment, with demand coming from early-stage companies that have successfully raised funds. This trend is evident when reviewing take-up by size band, with 88% of deals recorded in the last five years below 10,000 sq ft.
There has been £230 million of VC invested into companies headquartered in Oxfordshire in Q1 2026, which was only marginally behind the annual total of £243 million recorded in 2025. The improved level of VC investment bodes well for increased levels of take-up and the expansion of the science and innovation ecosystem.
Notably, two occupiers raised over £50 million of VC in the first quarter of the year. Oxa Autonomy and Oxford PV raised £77.7 million and £111.9 million of Series D funding, respectively.
The Oxford office market remains active, with strong demand for high-quality, accessible, amenity-rich buildings, particularly in the city centre, where constrained supply is expected to drive further rental growth.
Rob Beatson, Head of Oxford Commercial Agency
City centre supply constraints persist, with development pipeline limited
Supply currently stands at 752,000 sq ft, with the majority of available space being of a secondary nature. Only 27% of supply is classified as Grade A, which is impacting take-up volumes, with a polarisation of performance of office assets in the market based upon location and quality being more pronounced in recent years.
The majority of Grade A space is in out-of-town locations, with only 15% of supply of this quality being situated in the city centre. Red Hall, Oxford North, offers the largest quantum of available Grade A space, with 29,000 sq ft currently available to lease at the scheme.
Looking forward, the supply constraints in the city centre will persist in the short term. The redevelopment of Cantay House will temporarily alleviate the supply shortage, with 27,000 sq ft of prime Grade A space being scheduled to complete in 2027. This is, however, the only city centre office development actively under construction.
Prime city centre rents set to be uplifted by new development
Prime rents remained static in the first quarter of 2026 due to no new stock coming forward, with an expected uplift in the city centre to occur later in the year.
The flight to quality in the market, combined with the acute shortage of prime space, is expected to deliver above-average levels of rental growth for best-in-class product. This will be tested at Cantay House, where 27,000 sq ft is being delivered in 2027.
Find out more about Oxford's property market here.
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