Search Results for: london

June 15, 2016

Tech sector drives demand for office space in London’s City fringes ⁰

by Sara Bean • Cities, News, Property, Technology

London’s City Fringe market, the once ‘cheap’ office location of Central London has matured into a leading global tech address and, with a number of new mixed use developments underway and more planned, its success is set to continue. According to data from Savills, average Grade A rents in the area have increased by 87 percent in the last six years with the best new office space now trading at a discount of only 3.5 percent to the same quality of building in the City Core (a saving of circa. £1 per sq ft). According to Savills research, the first quarter of 2016 saw average Grade A rents in the City Fringe reach £59.42 per sq ft (compared to £61.60 per sq ft for non-tower Grade A office buildings in the City Core). This pattern is accelerated by new office developments including Derwent’s White Collar Factory and Helical Bar / Crosstree’s Bower Development, both EC1, and key deals to Adobe, BGL Group, Stripe Limited and CBS Interactive.

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June 8, 2016

Mayor of London moves to open up more office spaces for startups ⁰

by Neil Franklin • Cities, Flexible working, News, Property

It is telling that one of the first issues to be addressed by incoming London Mayor Saddiq Khan is the problem the capital’s thriving startups have in simply finding a place to work. Although the measures outlined in the new London Plan are aimed primarily at addressing London’s housing crisis, they also include measures to deal with the reduction in the amount of viable office space available following the relaxation of planning rules which allow developers to more easily switch existing office stock to residential use. The costs of office space in London is a growing concern for all sectors, but falls especially hard on startups. According to a recent study by SpareOffice, even the use of coworking space is an issue, with average monthly fees of £357 per person. Now the mayor has announced that he will put new measures in place to help protect and expand office space for small businesses, start-ups and entrepreneurs in London.

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June 1, 2016

Financial sector is rationalising real estate to remain in London ⁰

by Sara Bean • Cities, Facilities management, Property

A relentless drive to cut costs is forcing financial services occupiers to focus on reducing real estate costs and adopting strategies to use their space more efficiently in Central London. According to research from CBRE there has been an ongoing move by big banks to relocate non-core functions outside of Central London, as seen in HSBC’s decision to move 1,000 head office staff from London to Birmingham. However despite the inherent challenges, banks continue to cite client needs, recruitment, profile and presence as key reasons to keep office space in the Capital. This is reflected in last year’s leasing figures with banking and finance occupiers leasing 3.2m sq ft, 4.9 percent above the 10-year average. There are a variety of compromises companies may make as part of rationalisation strategies to maintain their position in London. Consolidation is an ongoing trend. But it is not a one size fits all approach.

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May 27, 2016

Canary Wharf bucks London’s Brexit office market slow down ⁰

by Sara Bean • Cities, Facilities management, News, Property

Canary Wharf has outperformed the Central London office market during the past 12 months, with rental growth reaching 26.7 percent, ahead of Mayfair and St James’. It seems Canary Wharf’s high quality purpose built space, coupled with its relative affordability when compared to the rest of London, has helped attract significant deals in recent months. The most notable deal during Q1 was Thomson Reuters take up of 300,000sq ft in St Martin’s 5 Canada Square. Faisal Durrani, Cluttons head of research, explained, “It was only a matter of time before the area began to draw in occupiers, particularly from the City and City fringes. It’s a market that has undersold itself and its full potential is yet to be realised but we may be approaching a significant turning point in its attractiveness. In recent months, the Central London market has experienced Brexit nervousness and general settling of the market but Canary Wharf has bucked this trend.”

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May 17, 2016

London’s central office market peak driving change for other zones ⁰

by Tobi Crosbie • Cities, Comment, Facilities management, Property

There are plenty of good reasons to believe that London’s Central office market has hit its peak. Rents are at an all-time high in the majority of core office locations and whilst the start of 2016 has seen rents rise, there is certainly a clear steadying of the pace. According to our own data, the Landlord’s quoted rents for offices across the entire Central London market. Core offices such as Mayfair and St James’s have reached levels of £150 per square foot (pfs) in Q1 2016 compared with £120 per square foot in Q1 2015 a rise of 25 percent in 12 months. That does sound excessive, until this is compared with the rises seen East of the city in so called ‘fringe markets’ of Clerkenwell, Old Street and Shoreditch. Here the rents have become eye watering. In Q1 2015, the prime quoting rent in Shoreditch had reached £55 psf. In Q1 2016, this number had reached £75 psf highlighting an increase in 12 months of over 35 percent.

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May 12, 2016

Office construction at highest level in London for eight years ⁰

by Sara Bean • Cities, Facilities management, News, Property

Office construction in the Capital is at its highest level for eight years, according to Deloitte’s latest London Office Crane report, which measures the volume of office development taking place across central London. Recognising that the low supply of available office space across central London offers a limited choice for tenants, developers have responded by starting a record number of new schemes since the last survey. The latest results show that the volume of office construction has increased by 28 percent over the past six months to 14.2 million sq ft the highest level since the beginning of 2008. In just 18 months activity nearly doubled from 7.7 million sq ft in 2014. The financial sector has leased the largest share of office space under construction in the latest results, accounting for 2.3 million sq ft, or 39% of the let space while currently accounting for 38 percent of the space let, the TMT sector is a leading occupier group.

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May 11, 2016

Central London office activity slows as EU uncertainty hits market ⁰

by Sara Bean • Cities, Facilities management, News, Property

Given the level of uncertainty around June’s Referendum on the UK’s membership of the EU, the £11.9bn invested into commercial real estate during the first three months of 2016 appeared robust. However, 50 percent of Q1’s volume was in January, with the data from Lambert Smith Hampton showing that activity tapered off significantly in the following two months. Anecdotal evidence clearly linked the slowdown directly to the approaching vote. As a result there was a significant fall in activity, which translated into a very quiet quarter for Central London Offices, where volume halved quarter-on-quarter to £2.2bn, the lowest quarterly total since the last part of 2011. Given that financial services is widely regarded as the most exposed sector to a possible ‘Brexit’, this sector appears to have suffered most from investor caution.In marked contrast, investment in the rest of UK Offices has remained buoyant at £1.4bn, the highest quarterly total since the middle of 2007.

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May 7, 2016

Problem of London’s success + Design & people + Latest Work&Place ⁰

by Sara Bean • Architecture, Facilities management, Newsletter, Workplace

In this week’s Newsletter; Simon Heath suggests that FM should be satisfied with remaining essentially a service; Mark Eltringham bemoans the rise of tall buildings; examines commercial buildings that become synonymous with an organisational or sector crash; and celebrates the work of Donald Broadbent, whose research into cognitive psychology helps us address the effects of unwelcome noise in open plan offices and of German artist Fritz Kahn, in providing some understanding of how people respond to their surroundings. There’s news of a significant drop in employee satisfaction; why remote working may help to reduce the strain on overcrowded cities; and the negative effects of admin and unreliable technology on productivity. You can read the latest issue of Work&Place, download our Insight Briefing, produced in partnership with Connection, on the boundless office; visit our new events page, follow us on Twitter and join our LinkedIn Group to discuss these and other stories.

May 5, 2016

The problems that come with London’s success need better solutions ⁰

by Mark Eltringham • Architecture, Cities, Comment

We might all welcome London’s success as a thriving centre of commerce and culture, but this comes at a price and we need to look for a better balance than we currently see between London and the rest of the UK. Of course London is often the main victim of its own success. Its thriving tech and creative firms continue to spill out of the incubator districts created for them to find cheaper and more appropriate spaces in which to grow. In doing so they are pushing up rents in such unlikely nearby places as Croydon. In the traditional business districts in the City and Docklands, the capital’s tech giants are now able to compete for the first time for some of the most expensive real estate on the planet. To cope with demand, the Mayor is rubberstamping tall buildings like never before, many of them bloody awful, unloved by Londoners and heritage organisations alike, transforming the skyline and creating windswept, arid tundra at their feet.

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May 4, 2016

London firmly established as global leader in tech and media start ups ⁰

by Sara Bean • Cities, Facilities management, News, Property, Technology

One new tech company has started every hour in London since 2012, which has firmly established the Capital as the global leader in tech and media start ups. According to property firm JLL, over the last five years, a massive 45,000 new tech businesses has been set up in London, with 98 percent of tech companies being start-ups and small businesses. There is migration from the West End to the City and the East, including ‘Silicon Roundabout’ in Old Street, but also new areas which are attracting technology and media companies. The growth of small business has also seen the average office footprint of T&M business fall over the last three years. JLL says for every one T&M company that moved out of Aldgate, Clerkenwell and Shoreditch over the last three years, two new tech and media companies moved in indicating the rapid consolidation of T&M business in the East.

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April 28, 2016

London’s office occupiers likely to move out to regions over next decade ⁰

by Sara Bean • Cities, Facilities management, News, Property

The high costs associated with accommodating staff in London will lead to a trend over the next decade of office occupiers moving away from the capital to the major cities around the UK. This is according to the 2016 edition of property consultancy Lambert Smith Hampton’s annual Office Market Report, which highlights the significant and growing difference in premises, staff and housing costs between Central London and the UK’s other key cities. For cities such as Bristol, Manchester and Birmingham, staff and premises costs (including rent, business rates, day-to-day running costs etc) for a new-build office collectively amount to just over £50,000 per workstation. Measured on the same basis, a workstation in London’s Midtown area carries an annual cost of well over £80,000. In practice, this means that the overall cost of occupying a new-build office in a location such as Bristol for 500 staff stands at £27m per annum; in Midtown, the total cost would be over £13m higher each year.

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April 21, 2016

Brexit referendum has not diminished demand for London office property ⁰

by Sara Bean • Facilities management, News, Property

Political uncertainty over the Brexit referendum has done little to diminish demand for London office property, despite it causing the commercial property market to experience a nervous start to the year. According to the latest research from Colliers, the number of vacant offices still remains low, with occupiers appearing to be relatively un-phased by external political and economic upheaval. There has been some high profile lettings and a healthy number of new large scale enquiries in the first quarter of this year – but transactions and searches have become protracted and supply shortages are undermining occupier expansion plans. However demand for office space amongst media and tech firms is diminishing in some locations. While Q1 2016 figures show that media and tech accounted for 38 percent of demand for office space across London, in the traditional media enclave of the West End, the figure fell to just 13 percent of demand, down from 45 percent in 2015.