Central London office lettings in August 2018

Central London office lettings in August 2018 reached just over 750,000 sq ft from 40 mid-large size office transactions (5,000 sq ft+) during the month. The August 2018 figure is below the current monthly London average of 1m sq ft.

August was characterised by 9 office deals over 20,000 sq ft, which were led by the Investec’s 123,000 sq ft deal to pre-let 55 Gresham Street, EC2, N1; Competition and Markets Authority 105,000 sq ft deal at 25 Cabot Square, E14 and Hiscox’s 75,000 sq ft pre-let at 22 Bishopsgate, EC2.

Financial services topped the table of lettings by sector, compiled by Metropolis, underpinned by the Investec deal. This was followed by business services led by a number of lettings to Office Space in Town and LEO. Insurance, professional and media were also well represented. Office deals ‘under offer’ in central London increased to 3.9m sq ft, and pending deal volumes are healthy in nearly all sub-markets, with a number of deals pending.

By area, the City accounted for 47pc of the office floorspace let in August 2018 at 354,000 sq ft. The West End saw 150,000 sq ft of take-up. Midtown contributed 69,000 sq ft of lettings. Current London office demand is calculated to be around 3.7m sq ft in the City and 3.2m sq ft in the West End.

The volume of grade A (newly built or refurbished office space) let during the month reached 413,000 sq ft sq ft (55% of the monthly total), as transactions for new space resumed their recent strong showing. Availability is dominated by secondhand space in all London markets.

Metropolis research is currently monitoring 645 ‘live’ London requirements, with deals for space of up to 1.8m sq ft due to sign in the next few months.

Cityoffices is working on its autumn ‘Skyline Survey’ in London. Further details of office scheme planning applications and consents, with scheme by scheme detail are listed on the Cityoffices.net website. Details on Metropolis and the Cityoffices database from Andy King at andy@metroinfo.co.uk

London Lettings – January 2017

Central London office lettings in January 2017 recorded 567,000 sq ft of deals from 35 mid-large size transactions (5,000 sq ft+) during the month.

The January figure represents a fallback from the exceptional 1.8m sq ft of lettings in December as a more normal level of market activity resumed.

January was characterised by 9 office deals over 20,000 sq ft, which included the McKinsey’s 97,000 sq ft pre-letting of the under construction Post Building in London, WC1; COS Stores (H&M) took a 60,000 sq ft pre-let at the also under construction 1 New Oxford Street, WC1 and Antares Underwriting took 31,500 sq ft at 21 Lime Street, EC3.

Professional services topped the table of lettings by sector, underpinned by the McKinsey deal, this was followed by IT services with large lettings to Nexmo amongst others. Retail also performed well helped by the letting to the H&M. Office deals under offer in central London stayed at 2.1m sq ft after the stream of completed deals.

By area, the City accounted for a modest 34pc of the office floorspace let in January – a fallback even from the 44pc in December. The West End saw 150,000 sq ft of take-up. Midtown contributed 195,000 sq ft of lettings as much as the City. Current London office demand is calculated to be around 4m sq ft in the City and 3m sq ft in the West End.

The volume of grade A (newly built or refurbished office space) let during the month reached an impressive 306,000 sq ft (54% of the monthly total), as transactions for new space maintained their recent strong showing.

Reasons to be Post-Brexit Cheerful 1, 2, 12…

Despite a lacklustre Q2 London office market in the run up to EU referendum vote, the July deals have come thick and fast this week as the market shakes off the blues. Deals concluded this week have included these 12:

Wells Fargo, the US bank, has bought the under construction 227,000 sq ft 33 Central office development in London, EC4 for its own occupation as its new London HQ.

The Government Property Unit has signed for 400,000 sq ft of deals at 20 Cabot Square, London, E14 for a host of public sector bodies including 150,000 sq ft for regulator OFGEM.

Derwent London has pre-let 84,600 sq ft in four deals at its 185,000 sq ft refurbishment of The White Chapel Building E1. Incoming tenants include Reddie & Grose, Perkins & Will, The Shipowners’ Club and Unruly Media.

Exterion Media, the advertising agency, is taking the 2,323 sq m (25,000 sq ft) seventh floor of the newly-completed 84 Theobalds Road office scheme, London, WC1

David Game Tutorial College take the 60,000 sq ft 31 Jewry Street, London, EC3.

University College London take 23,000 sq ft at 1 St Martin’s Le Grand, EC1.

Kames Capital and MS Amlin take expansion space at the Leadenhall Building.

Public Lab, a DIY environmental science community, is due to sign for 15,000 sq ft at Aldgate Tower, London, E1.

Further details of these and many more upcoming relocations are available to Metropolis subscribers at http://www.metroinfo.co.uk

London Lettings – February 2016

Central London office lettings picked up in February 2016 with 984,000 sq ft of office space transacted in 43 deals in during the month. The figure represented a 20% increase on the January total, but below the recent average of 1m sq ft per month.

February was characterised by 11 office deals over 20,000 sq ft, including Capita at the Copyright Building, W1; Aecom at Aldgate Tower, E1 and Zoopla at Cooperage Building, SE1.

Business services again topped the table of lettings by sector, helped by Capita’s 94,000 sq ft pre-let and more lettings to serviced office operators, this was followed by professional services boosted by Aecom. Media and property-related sectors are also performing well. Office deals under offer is holding at around 2.7m sq ft, with notable activity in Docklands and Southbank.

By area, the City accounted for only just over a 68pc of the floorspace let in February. The West End had a quiet month, aside from the Capita deal, but the Southbank saw above average activity. Current London office demand is calculated to be around 4.1m sq ft in the City and 3m sq ft in the West End.

The volume of grade A (newly built or refurbished office space) let during the month reached 338,000 sq ft (34% of the total), as transactions for newly developed or refurbished space continue to take a slightly smaller part of the total than recent months.

Some 7m sq ft of new office space is expected to complete in London in 2016. Further details of schemes and pre-lets on Cityoffices.net.

22m sq ft of office demand

Metropolis 2015 UK Research Review

The Metropolis research team produced a total of 6,439 relocation, construction and refurbishment leads in 2015.  1,195 new office requirements were identified in total,  accounting for 22m sq ft of demand from companies looking for new office space.

62% of Metropolis leads were projects located in the South of the UK, with 38% of lead projects located in Wales, the Midlands, North, North West, Yorkshire & Humberside, Scotland and Northern Ireland. Greater London projects represented 44% of the 2015 lead total.

 

 

 

 

 

 

 

Greater London

In Greater London, Metropolis identified  just over 16m sq ft of requirements for offices, with over 827 companies looking for new space. About 12.6m sq ft of this demand was for central London space. The top 5 most sought after postcode areas by demand were:  EC2 (2.2m sq ft), W1 (2m sq ft),  SW1 (1.7m sq ft),  EC3 (1.3m sq ft) and E14 (1.2m sq ft).

 

South East

The number of leads in the South East (not including London) jumped by 22% when compared to 2014’s total. Over 150 office requirement leads were researched in the region in 2015,  representing just over 3.5m sq ft of office demand. The largest office requirements centered on RG1 and SL1 postcodes, including several 9,290 sq m (100,000 sq ft) + requirements from energy, media, pharmaceutical and technology companies.

 

North West

Office relocation and refurbishment activity continued to be strong in the North West, particularly between 186 sq m (2,000 sq ft) and 929 sq m (10,000 sq ft) projects.  Just over 2m sq ft of office demand was identified in the region, the largest requirements centered on the Greater Manchester area. About 60 Manchester companies were linked with searches for new space, around 1.5m sq ft of office demand.

 

Scotland

Leads numbers in Scotland were slightly up on 2014’s result (3.5% up). The region remains the UK’s 4th most active in terms of the number of  Metropolis lead projects researched, but 3rd in terms of total office demand.  Metropolis identified 2.1m sq ft of office demand in Scotland as a whole in 2015, 1m sq ft of which was demand for Edinburgh space and 0.8m sq ft of which was demand for space in Glasgow.

Some of the largest requirements came from the banking and finance sector, which were mainly centered on Glasgow. The largest requirements for Edinburgh space came from the accountancy, law and technology sectors.

 

Yorkshire & Humberside

In Yorkshire and Humberside, just over 1m sq ft of office requirements were identified, with 115 companies looking for new space. Demand for new space in Leeds accounted for 0.8m sq ft.

 

West Midlands

West Midlands lead numbers were up 21% on the 2014 total. Just over 1m sq ft of office demand was identified in the region, 0.7m sq ft in Birmingham. About 180,000 sq ft of office demand was identified in Coventry, boosted by a 100,000 sq ft requirement from an energy company.

 

South West

In the South West, just over 0.5m sq ft of new office demand was identified. Bristol was the preferred location in the South West for large insurance and law sector moves.

 

North

Lead numbers in the North increased significantly for the second year running, up 29% on 2014. About 0.6m sq ft of office demand was identified in the region, 0.2m sq ft in Newcastle.

 

East Midlands

Lead numbers in East Midlands were slightly up on the five year average. The largest requirements mainly came from the manufacturing and retail sectors looking for distribution space with offices.

 

East of England

East of England lead numbers were up 33% on 2015’s total. The top five office requirements by size came from technology, pharmaceutical, accountancy and law sector companies. Office demand tracked in Cambridge reached 0.4m sq ft.

 

Wales

The largest office requirements in Wales came from the Public sector, with a 130,000 sq ft requirement from a government department  looking in Cardiff. However there were also two 100,000 sq ft requirements from law and insurance firms also looking in Cardiff, where total office demand was just over 0.5m sq ft.

 

Northern Ireland

The largest office requirements unsurprisingly came from Belfast occupiers, with government, accountancy and technology sectors the most active.

 

 

UK Lead Projects By Size

50% of Metropolis leads in 2015 reported on projects over 10,000 sq ft. 44% of leads were made up of projects between 5,000 sq ft and 30,000 sq ft. 68% of leads covered projects over 5,000 sq ft.

 

 

 

 

 

 

 

The increase in lead projects between 2,000 and 5,000 sq ft was  significantly influenced by added investment into regional research by Metropolis, particularly in the South East, West Midlands and South West.

A significant number of new office mover leads, typically 20 to 50 staff relocations,  were identified in these areas in 2015.

The 40 and 50 redevelopment schemes in London that effected existing tenants in 2015 also contributed to an increase in the proportion of these lead projects.

These schemes, which include demolition and refurbishment of existing buildings,  forced hundreds of SME office occupiers to find new space, the significant proportion of which occupied between 1,000 and 5,000 sq ft.

 

 

 

 

 

 

 

 

UK Lead Numbers by Sector

The Banking & Finance Sector just edged ahead of  Technology & Telecoms leads in 2015 and was the most active UK business sector in terms of relocation and refurbishment projects. Lead numbers fell by 8.5% when compared to 2014’s strong result,  but were still about equal to the five year average.

The largest requirements in this sector were focused on space in Docklands and London EC2. The largest office lettings were on space in London EC4 and EC2.

 

 

 

 

 

Office demand from the technology and telecoms sector was just over 3m sq ft. Two of the top five largest requirements for new space from the T&T sector came from social media companies, both seeking in excess of 100,000 sq ft of space in the West End of London.

The majority of requirements for new space over 50,000 sq ft centered on London, but there were notable exceptions, including a 150,000 sq ft requirement for space in Cambridge from a US Software firm and a 100,000 sq ft requirement for offices in Warrington from a US computer manufacturer.

Office demand from media sector companies, often grouped with Technology and Telecoms under the banner “TMT”, reached 2.5m sq ft.

Central London, particularly SW1, W1 and WC2, was the overwhelmingly preferred location for this sector. The largest media requirement outside of London came from a media broadcaster looking for 150,000 sq ft in the Thames Valley.

Demand for new space in the law sector focused on London EC2, with three 200,000 sq ft + requirements for new space in this postcode.  Outside of London, the largest office requirements centered on Manchester and Birmingham.

 

Copyright Metropolis Property Research Ltd 2016

Central London Office Deals – September 2015

Central London office lettings registered a small rise to 840,000 sq ft of transactions in September 2015, spread across 52 deals during the month.

September was characterised by 10 deals over 20,000 sq ft, including Deutsche Asset & Wealth Management taking 90,000 sq ft at the Zig Zag building, Victoria Street, SW1; Mediobanca at 62 Buckingham Gate; Universal Music at 4 Pancras Square, N1 and Seven Investment Management at 55 Bishopsgate, EC2.

Financial services topped the table of lettings by sector, helped by Deutsche and seven Investment Management deals office, followed by media boosted by Universal Music’s pre-let. Office deals under offer (including RBC in the City) fell slightly to 3.8m sq ft.

By area, the City accounted for a little under half the deals (21) but only 30pc of the floorspace let in the month as other areas saw a lettings boost. Current London office demand is calculated to be around 6m sq ft in the City and 3.7m sq ft in the West End. Availability fell to 9.6m sq ft, but a large number of new schemes are at demolition stage and soon to be marketed.

The volume of grade A (newly built or refurbished office space) let during the month reached 557,000 sq ft (66% of the total), as transactions for newly developed or refurbished space took a large part of the total.

Metropolis is about to publish a new report on upcoming London office schemes for autumn 2015.

Central London Office Lettings 2014

Best Year For Deals Since 2007

Metropolis has recently published its latest client newsletter, this month a special report on central London office lettings in 2014. Highlights include:

– Central London deals hit 12.8m sq ft, up 5% on 2013 take-up
– 14 deals were over 100,000 sq ft
– Metropolis is tracking over 700 central London office requirements
– Just over 2m sq ft currently under offer

The newsletter was provided exclusively to Metropolis clients. If you are interested in finding out how Metropolis could help your company win new business please visit us at http://www.metroinfo.co.uk.

Top 10 London Business Sectors in 2013

Banking & Finance leads the way

Banking and finance leads dominate the London business sector top ten for the fifth year running. The largest office requirements emerging from this sector are focused on the London EC2 postcode area.

 

 

 

Similar to the UK picture, Technology, Media and Telecoms (TMT)  sectors make up a sizable portion of the top ten in London (33.5%). The largest relocation and refurbishment projects in this sector are focused on London N1 and SE1.

Law and Insurance sector leads saw an increase on 2012 numbers. Unsurprisingly law sector relocation activity centers on London EC4 postcodes, although there was also significant demand for new space in London EC2. Insurance sector office demand centered on London EC3, with close to 700,000 sq ft of space required in this postcode last year.

London office deals reached 12.2m sq ft in 2013, up 37% on 2012’s result. According to our research, over 450 requirements for new space in London were active in the last six months and over 1,300 occupier lease expiries are due in the next two years. We expect to see office demand in London grow further this year, buoyed by improving economic conditions.  There is currently close to 7m sq ft of office space under construction in central London expected to be delivered before the end of 2014.