The London Occupier Fit-Out Market 2010-2014

‘Living In A Pre-Let World’

Metropolis Property Research has released it’s latest report on the central London fit-out market 2010-2014. The report ‘Living In A Pre-Let World’ provides an analysis and Top 10 rankings for firms involved in interior design and project management, fit out ‘build’, and agents advising tenants.

The No1 Ranked ‘TOP 10’ firms are:

No1 Interior Architect – TP Bennett
TP Bennett has been ranked as London’s No1 interior architect with 4.2m sq ft of occupier interior fit-out projects 2010-2014.

No1 Fit-Out Contractor – ISG
ISG has been ranked as London’s No1 fit out contractor with 3.8m sq ft of occupier fit-out projects 2010-2014.

No1 Interior Project Manager – CBRE
CBRE has been ranked as London’s No1 project manager on interior fit out projects for occupiers with 3.7m sq ft of projects 2010-2014.

No1 Tenant’s Agent – CBRE
CBRE has been ranked as London’s No1 tenant’s agent with 5.1m sq ft of occupier deals done 2010-2014.

Editorial Notes
In the five years covered by the research (2010-2014) a total of 54.4m sq ft of office space has been let in central London. Deals over 25,000 sq ft, which are the focus of the analysis, amounted to 30.6m sq ft, in 330 projects.

In the report ‘fit-out’ is defined as being the fitting out of new office space for those corporate occupiers signing deals for space in central London in the period 2010-2014.

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The report ‘Living In A Pre-Let World’ is available from Metropolis Property Research. For details please contact Simon Sluszny – simon@metroinfo.co.uk

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About Metropolis Property Research Ltd
Metropolis Property Research is an independent research and information company established in 1998. The company carries out research into the UK and international office markets and corporate moves. http://www.metroinfo.co.uk
26.06.15

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Central London Office Deals May 2015

Central London office lettings registered nearly 1.1m sq ft sq ft of transactions in May 2015, spread across 43 deals during the month.

The month was characterised by 13 deals over 20,000 sq ft, including FCA at the Stratford Quarter; Arthur J Gallagher at 67 Lombard Street; Uber at Aldgate Tower, WC2: Barts NHS Trust at St Martins Le Grand and Penningtons at 125 Wood Street. Other large lettings included deals to UCL, ACCA, Texas Pacific and Meraki.

Financial sectors topped the table of lettings by sector, helped by the FCA and Texas Pacific deals, followed by computer/IT and business services. Under offers increased to over 4m sq ft – the highest level since the recession. Under offers include a company negotiating on over 350,000 sq ft at 10 Upper Bank Street, E14.

By area, the City accounted for over half the deals (26) and 63pc of the floorspace let in the month. Office demand is calculated to be around 5m sq ft in the City and 2.5m sq ft in the West End. Availability rose slightly during may helped by construction start of the Verde Building in Victoria, SW1.

The volume of grade A (newly built or refurbished office space) let during the month increased to over 600,000 sq ft as transactions for newly developed or refurbished space rose again.

Metropolis is putting together a 2015 report on the London office fit-out market. Details to follow.

East Midlands rising

Office agents in the East Midlands point to improving market trends in Nottingham, Leicester and Derby, while Metropolis has noticed a rise in the number of requirements across the region.

Nottingham’s office market recorded 370,000 sq ft of office market deals in 2014 which is around the long term yearly average, helped by a 60,000 sq ft letting to Parexel at Castle Wharf, Nottingham, together with recent lettings to Arup taking 10,500 sq ft at City Gate West, Winbro Group taking 28,000 sq ft out of town, while Littlefish took almost 9,000 sq ft on Stoney Street. Metropolis has recorded a number of new searches in Nottingham this year. The Nottingham market has plenty of secondary quality offices, but little grade A space apart from the new Nottingham One scheme. Sladen Estates and Peveril Securities have bought the Nottingham site at Unity Square. The site has planning permission for up to 460,000 sq ft of office space, along with a hotel.

The Leicester office market saw continued improvement over the last 12 months with 300,000 sq ft let in over 50 transactions which were skewed towards the out of town market over the city centre. Movers included Travis Perkins taking 22,000 sq ft at Grove Park, Total Motion at Meridian Business Park and Hastings Insurance taking an initial 20,000 sq ft. The market has been bolstered recently by new searches. Office supply remains tight in Leicester and new space is restricted to Marlborough Properties’ just-completed Watermead scheme, with the forthcoming redevelopment of council offices at Welford Place next in the pipeline.  Inward investment enquiries increased in the second half of 2014 which agents hope will lead to significant lettings.

Derby saw total office take-up reach 150,000 sq ft in 2014 with University of Derby taking 33,000 sq ft at One Friar Gate Square, Interfleet Technology taking 13,000 sq ft at Roundhouse Road, Comex 2000 taking 6,000 sq ft at Cranmer Road and Citibank taking 4,461 sq ft at Pentagon House. However local agents bemoan lack of available space at its premier Pride Park office location, apart from the recently completed One Frair Gate Square scheme and there is approximately 70,000 sq ft of new space in the pipeline at Pride Park.

In conclusion, the East Midlands remains one of the quieter regions for office requirements, however there are signs of an upturn in office market activity in Nottingham, Leicester and Derby, which could translate into more deals later in the year.

Metropolis London Skyline Survey

Metropolis has walked the streets of central London to compile its twice yearly skyline survey into the state of office development in the capital in 2015. The full report is available to clients, but the main conclusions were:

  • Office construction is on an upward path with 74 office schemes under construction in central London (72 a year ago) totaling an increased 9.5m sq ft (8m sq ft in October 2014).
  • In the last six months there have been 32 new office scheme starts in central London, totaling 4.1m sq ft
  • The proportion of refurbishments in the office construction market in central London has slipped to a 25:75 split by floorspace ratio of refurbishments:new-build.
  • The City dominates construction with 4m sq ft of new office space in schemes underway.
  • Work has started on 14 new West End schemes in the last six months, as part of a modest rise in construction activity in the West End to 34 schemes under construction.
  • Some 3m sq ft of the 9.5m sq ft office space under construction has already been pre-let.
  • More than 30 future schemes are currently at site preparation stage with nearly 5m sq ft of additional office space due to go under construction in the next 6 months.
  • Just over 3m sq ft of offices was completed in central London over the last six months, however a large proportion of the space was let either prior to completion or just after.
  • In total, less than 1m sq ft of offices are still available in the 27 London schemes and 3m sq ft of offices completed in Q4 2014 and Q1 2015. Some 32 different tenants have already signed up for space.
  • There are currently 1.6m sq ft of offices due for completion in Q2 and Q3 2015, of which only 400,000 sq ft has so far been pre-let.
  • Total office development underway in central London should break through the 10m sq ft ceiling in summer 2015.
  • Drops in availability are forecast to trigger a new wave of fast-track refurbishments.