Central London Lettings – July 2017

Central London office lettings in July 2017 sustained a healthy 820,000 sq ft of deals from 48 mid-large size transactions (5,000 sq ft+) during the month. The July figure is close to the current monthly average of just under 1m sq ft .

July was characterised by 14 office deals over 20,000 sq ft, which included Spotify’s 104,000 sq ft deal at the Adelphi Building, WC2: law firm Withers pre-let 60,000 sq ft at 20 Old Bailey, EC4; Yahoo/AOL took 43,000 sq ft at Mid City Place, WC1 and HSBC pre-let 36,000 sq ft at 7 Cork Street in W1.

IT and tech services topped the table of lettings by sector, underpinned by the Spotify and Yahoo deals. This was followed by professional services with large deals involving Withers and Bazalgette Tunnel. Financial services also performed well, helped by the lettings to HSBC and Redington. Office deals ‘under offer’ in central London held steady at 3.4m sq ft and pending deal volumes are healthy in nearly all sub-markets.

By area, the City accounted for 31pc of the office floorspace let in July at 250,000 sq ft. The West End saw 177,000 sq ft of take-up. Midtown contributed 300,000 sq ft of lettings. Current London office demand is calculated to be around 3.2m 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 480,000 sq ft (58% of the monthly total), as transactions for new space resumed their recent strong showing.

Metropolis research is currently monitoring 600 London requirements, with deals for space of up to 3m sq ft due to sign in the next few months.

Cityoffices and Metropolis have just released releasing their twice yearly Skyline report on the London office construction market. The summer report features analysis of the 100 schemes under construction and the trends for the next wave of schemes. Details on Cityoffices from Andy King at andy@metroinfo.co.uk

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Patchy Leeds Demand

Demand for office space in Leeds for the first half of 2017 remains similar to the 12 months that preceded it, but trailed the five year average by 18 per cent, according to new research.

The CBRE Leeds office marketview report found that office take-up in the city was 237,165 sq ft in the first six months of 2017.

There were three lettings over 20,000 sq ft; a 46,058 sq ft letting to Burberry at 6 Queen Street, 25,968 sq ft to Willis Towers Watson at 5 Wellington Place and 22,441 sq ft to BW Legal at 1 Apex View.

The majority of take-up in the city was in the sub 5,000 sq ft size band.

Despite the lower level of enquiries in all size ranges, annual take-up is still likely to be a record for Leeds city centre if the pre-let of 350,000 – 380,000 sq ft at Wellington Place to the Government Property Unit goes ahead.

Looking to the second half of the year, demand is expected to be patchy for at least another quarter.

Metropolis has run nearly 40 new requirements for Leeds office space this year, however most searches are small.

3 Wellington Place (109,000 sq ft) is the only new development completing within the next 12 months. Refurbishments available this year, include ‘Platform’ (120,000 sq ft) and 7 Park Row (40,000 sq ft),
which will help the dwindling Grade A market.

Office Moves Planned in July

Metropolis ran 580 business leads on ‘office movers’ in the month of July 2017. If all reported moves were added together the total would exceed 16 million sq ft of office searches and transactions, researched by Metropolis’ unique market led intelligence research team. London was the largest region with 247 leads during month, but there were also strong showings from the South East (63) and North West (62), Scotland (44). IT services and financial were the two largest business sectors planning relocations or agreeing moves during the month.

The business leads covered the whole UK and provided details of the size of the office occupier, its likely move dates, a description of the reasons for the move, its business sector and full contact details including an address for written inquiries, at least one telephone number and in most cases an email address. Some of the largest planned moves and top picks amongst the 580 July leads. included those on Citi (Citigroup), HMRC, Credit Agricole and WeWork.

The July 2017 leads included 200 ‘identified requirements’. Which means that the company confirmed to researchers that it has current or future plans to search for alternative office space. Of these 200 searches, 134 were new office searches, not previously notified to clients.

The most recent research also included 130 ‘potential movers’ which were mainly longer-term leads on occupiers, considering a relocation, but have yet to make a final decision on whether to search.

Most of the remaining stories covered companies that have signed for new office space and have set a move date, including some large pre-lets and companies inviting tenders for fit-out contracts. The shortest planned move date is just over a month away, whilst the longest was late 2020.

If you would like some information on flexible Metropolis subscription packages, then please email Simon at simon@metroinfo.co.uk

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Cityoffices.net, the sister property leads service to Metropolis, saw a further 33 stories posted in July, covering new development opportunities planning applications, consents, construction starts and development teams in London and major cities. The database now covers over 200 office schemes in the pipeline for construction starts in 2017-2020.

For more information on Cityoffices, email Andy at andy@metroinfo.co.uk

Manchester’s Top Future Relocations

Lambert Smith Hampton has just released its Manchester office market report for Q2 2017. City centre office take-up for reached 284,497 sq ft across 68 transactions, a 23.3% increase on the same quarter in 2016. The cumulative 492,730 sq ft for the first half of 2017 is an increase of 14.6% on 2016.

The latest big relocations, movers and inward investments included: co-working giant We Work taking 55,802 sq ft offices at No.1 Spinningfields. Weightmans took 17,949 sq ft at the same building. EY is taking 40,000 sq ft at 2 St Peters Square; Car Finance 247 is relocating to 40,000 sq ft at Universal Building, Devonshire Street North; Distrelec is taking 17,000 sq ft at 2 St Peter’s Square, while Vodafone signed for 33,000 sq ft at Atlantic House.  Lookers acquired the 21,000 sq ft Aspect House in Altrincham,  21,200 sq ft was let at Regent Place, Salford to Convergys and Kaplan Financial also agreed a 10,000 sq ft move. Deals under 3,000 sq ft still accounted for 40% of take up

LSH secured the largest office deal this year outside of the city centre by acquiring 47,149 sq ft at 106 Dalton Avenue at Patrizia UK’s Birchwood Park, Warrington for Cavendish Nuclear. Business Services, consumer services and leisure and banking and finance have been the strongest sectors for take-up in the first half of the year. These three sectors accounted for 34%, 20% and 18% of take-up respectively

Metropolis is monitoring around 50 current office requirements in Manchester and around 60 ‘potential movers’, that is companies approaching lease expiries or with expansion plans, which have not decided whether to move yet.

Looking ahead, Manchester is expected to see faster office based employment growth over the next five years than Greater London and all of the major UK regional cities. Office based employment is
expected to grow by 6% over the next five years, significantly above the UK average of 3.5%.

Central London Lettings – June 2017

Central London office lettings in June 2017 bounced back just over 1.75m sq ft of deals from 108 mid-large size transactions (5,000 sq ft+) during the month.

The June figure represents a near tripling of the 600,000 sq ft sq ft of lettings in May. It brings the Q2 2017 central London lettings to a very respectable 3.1m sq ft and comfortably above the 2.4m sq ft in Q1.

June was characterised by 14 office deals over 20,000 sq ft, which included WeWork’s 283,000 sq ft pre-let of the under construction Southbank Place building, SE1: Framstore took 93,000 sq ft at 28 Chancery Lane, WC2; Industrial Light and Magic took 47,000 sq ft at Lacon House, Theobalds Road, WC1 and Hermes taking 46,000 sq ft at 150 Cheapside in EC2.

Business Services topped the table of lettings by sector, underpinned by WeWork deals, this was followed by media and financial services with large deals involving Industrial Light and Hermes. IT services also performed well, helped by the lettings to Misys and Reply. Office deals ‘under offer’ in central London held steady at 3.5m sq ft and volumes are healthy in nearly all sub-markets.

By area, the City accounted for 32pc of the office floorspace let in June at 566,000 sq ft. The West End saw 315,000 sq ft of take-up. Midtown contributed 400,000 sq ft of lettings, which was equalled by Southbank. Current London office demand is calculated to be around 3.3m 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 840,000 sq ft (48% of the monthly total), as transactions for new space resumed their recent strong showing.

Cityoffices and Metropolis are releasing its twice yearly Skyline report on the London office construction market. The summer report features analysis of the 100 schemes under construction and the trends for the next wave of schemes. Details on Cityoffices from Andy King at andy@metroinfo.co.uk

Top June picks on Metropolis

Metropolis ran 650 ‘movers‘ in the month of June 2017. If all reported moves were added together the total would exceed 17 million sq ft of office searches and transactions, researched by Metropolis’ unique market led intelligence research team. London was the largest region with 295 leads during month, but there were also strong showings from the Yorkshire (77), South East (57) and North West (44). IT services and financial were the two largest business sectors planning relocations or agreeing moves during the month.

The business leads covered the whole UK and provided details of the size of the office occupier, its likely move dates, a description of the reasons for the move, its business sector and full contact details including an address for written inquiries, at least one telephone number and in most cases an email address. Some of the largest planned moves and top picks amongst the 650 leads included leads were those on Google, Global Switch, Dentsu Aegis and WeWork.

The June 2017 leads included 196 ‘identified requirements’. Which means that the company confirmed to researchers that it has current or future plans to search for alternative office space. Of these 196 searches, 100 were new office searches, not previously notified.

The most recent research also included 200 ‘potential movers’ which were mainly longer-term leads on occupiers which are considering a relocation, but have yet to make a final decision on whether to search.

Most of the remaining stories covered companies that have signed for new office space and have set a move date, including some large pre-lets and companies inviting tenders for fit-out contracts. The shortest planned move date is just over a month away, whilst the longest was mid 2020.

If you would like some information on flexible Metropolis subscription packages, then please email Simon at simon@metroinfo.co.uk

—————————————————————————————————————————————————————————-

Cityoffices.net, the sister property leads service to Metropolis, saw a further 32 stories posted in June, covering new development opportunities planning applications, consents, construction starts and development teams in London and major cities. The database now covers over 200 office schemes in the pipeline for construction starts in 2017-2020.

For more information on Cityoffices, email Andy at andy@metroinfo.co.uk

Skyline Report Summer 2017

Metropolis and Cityoffices are about to publish their bi-annual survey of office construction in central London.

 

  • The survey brings readers all the statistics on the 101 office schemes in central London currently under construction and tenant activity connected to those schemes, right up to date to June 2017.

 

  • The survey, compiled after many hours of street surveys, telephone research and crosschecking, takes a snapshot of the central London office construction in Q2 2017, recent completions, recent pre-letting activity and looks ahead to future pipeline projects that will shape the next three years.

 

  • The report looks at the volume of construction underway, lists the major new scheme starts and looks at the proportion of refurbishment space compared to new builds. The report breaks down office construction by London district: City, West End, Midtown etc, as well as major recent building completions.

 

  • The survey also looks at occupier demand, with recent trends in pre-letting including examples of recent deals and a comparison with each of the last ten years.

 

  • The report then turns to the future pipeline including the 29 schemes currently at site preparation stage and 200 schemes with planning consent awaiting a start date.

 

  • Finally, it concludes with some forecasts for London office development based on current trends and makes predictions for London occupier demand over the rest of 2017 based on Metropolis’ detailed London office tenant research.

 

The report will be available free of charge to Metropolis and Cityoffices subscribers. If you are interested in a subscription contact Andy King at andy@metroinfo.co.uk