London Skyline Report 2017

Metropolis and Cityoffices have published their Winter 2017 survey of the London office market for clients and those due to take subscriptions in December 2017 and January 2018.

The new report covers:

  • Commentary on the 92 London office schemes under construction at the beginning of Q4 2017;
  • The report examines the 32 new London scheme starts between Q1 and Q3 2017, as well as schemes completed over the course of 2017;
  • The analysis looks at the next wave of schemes due to start construction over the next few months, with examples;
  • A section on occupier demand looks at space pre-let in under construction and recently completed schemes;
  • Further sections examine London office lease ends in 2016 and trace the destinations of those occupiers in 2017;
  • The report concludes looking ahead of 2018, in terms both of those 6m sq ft of schemes currently at demolition stage and those tipped to see construction starts over the next 12 months.

The closing sections of the report also cover forecasts of likely office completion levels in 2018-2020 and current levels of office demand amongst London occupiers, set against trends in the letting of grade A office space in central London.

All figures are based on Metropolis and Cityoffices’ huge weekly business leads bulletins and website which delivers 130+ weekly interviews with office occupiers considering relocations, fit-out news and office scheme developers.

If you would like to find out more about a trial subscription in December or January 2018 to Metropolis and claim a free Skyline report, then email Simon at simon@metroinfo.co.uk

 

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Thames Valley Autumn 2017

Recent research suggests that office take-up in the Thames Valley office market fell slightly in Q3 2017 to around 300,000 sq ft. of deals between July and late September. However, further pending deals amounting to over 250,000 sq ft of office space are understood to be under offer. Total take-up to the end of Q3 in 2017 is 1.25m sq ft.

The most active sectors were professional services at 20% and TMT (technology, media and telecommunications) at 19%, followed by pharmaceutical and life sciences sector, with Slough and Uxbridge as the most active towns. US-owned occupiers have around a 40% market share.

In Q3 2017, there were only five deals above 20,000 sq ft, down from nine large lettings in Q2. The largest single letting this quarter was WeWork taking 53,000 sq ft at 12 Hammersmith Grove. McAfee agreed a 19,500 sq ft move from the Bath Road to Slough town centre at the Urban Building. Fiserv signed to take 27,000 sq ft at the Porter Building in Slough, moving from Stockley Park. Some occupiers prefer to take existing space, with recent examples including: McLaren taking of 20,000 sq ft from SAB Miller in Woking and Birds Eye’s move to 40,000 sq ft of space sub-let from BP at Bedfont Lakes.

Occupier requirements have recently been driven by lease expiries, but there is emerging evidence of expansion led demand in the last two quarters.  The majority of current demand is in the sub 20,000 sq ft size band. There has been an increase in occupiers below 10,000 sq ft looking for small and flexible space.

Metropolis has confirmed nearly 150 medium/large office requirements in the Thames Valley since the beginning of 2017. Among some of the larger ‘live’ searches from at least 600,000 sq ft of new requirements in the area, include searches by: Novartis, JDA International and FCA Group. Metropolis is also tracking 140 Thames Valley companies with upcoming lease expiries, which could move in the next two years.

Central London Lettings – September 2017

Central London office lettings in September 2017 reached a healthy 965,000 sq ft of deals from 61 mid-large size transactions (5,000 sq ft+) during the month. The September figure conforms to the current monthly average of just under 1m sq ft .

September was characterised by 14 office deals over 20,000 sq ft, which included Boston Consulting’s 123,000 sq ft pre-let at 80 Charlotte Street, W1, Metro Bank’s pre-let at 20 Old Bailey, EC4; Costain took 30,000 sq ft at Victoria House, WC1, and Mitie took 30,000 sq ft at The Shard, SE1.

Professional services topped the table of lettings by sector, underpinned by the Boston Consulting deal. This was followed by financial services with the large deals involving Metro Bank. Property and Business services also performed well, helped by the lettings to Costain and Mitie. Office deals ‘under offer’ in central London increased slightly at 3.6m sq ft and pending deal volumes are healthy in nearly all sub-markets.

By area, the City accounted for 33pc of the office floorspace let in September at 314,000 sq ft. The West End saw 263,000 sq ft of take-up. Midtown contributed 242,000 sq ft of lettings. Current London office demand is calculated to be around 3.1m sq ft in the City and 2.8m sq ft in the West End.

The volume of grade A (newly built or refurbished office space) let during the month reached 448,000 sq ft (46% of the monthly total), as transactions for new space resumed their recent strong showing.

Some 8.9m sq ft of offices were let in the first 3 quarters of 2017 to end of September 2017.

Metropolis research is currently monitoring 620 ‘live’ London requirements, with deals for space of up to 2m sq ft due to sign in the next few months.

Cityoffices and Metropolis are working on an analysis of lease expiries which were due to expire in 2017 and the latest London Skyline report. The update will contain details of dozens of new office schemes under construction, planning applications and consents, with scheme by scheme detail on the Cityoffices.net website. Details on Cityoffices from Andy King at andy@metroinfo.co.uk

Central London Lettings – August 2017

Central London office lettings in August 2017 reached an exceptional 1.57m sq ft of deals from 58 mid-large size transactions (5,000 sq ft+) during the month. The August figure exceeds the current monthly average of just under 1m sq ft .

August was characterised by 13 office deals over 20,000 sq ft, which included Deutsche Bank’s 470,000 sq ft pre-let at 21 Moorfields, EC2: WeWork’s two pre-lets at The Stage, EC2 and the nearby ‘Shoreditch Exchange’; Kings College London took 73,000 sq ft at Roman Wall House, EC3, and Atos took 42,000 sq ft at Mid City Place, WC1.

Financial services topped the table of lettings by sector, underpinned by the Deutsche Bank deal. This was followed by business services with large deals involvingWeWork. IT services also performed well, helped by the lettings to OpenText and Kobalt. Office deals ‘under offer’ in central London held steady at 3.5m sq ft and pending deal volumes are healthy in nearly all sub-markets.

By area, the City accounted for 68pc of the office floorspace let in August at 1,066,000 sq ft. The West End saw 233,000 sq ft of take-up. Midtown contributed 145,000 sq ft of lettings. Current London office demand is calculated to be around 3.3m sq ft in the City and 2.9m sq ft in the West End.

The volume of grade A (newly built or refurbished office space) let during the month reached 1.2m sq ft (77% 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 2.5m sq ft due to sign in the next few months.

Cityoffices and Metropolis are working on an autumn 2017 update to their twice yearly London Skyline report. The update will contain details of dozens of new office schemes under construction, planning applications and consents, with scheme by scheme detail on the Cityoffices.net website. Details on Cityoffices from Andy King at andy@metroinfo.co.uk

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

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

Central London Office Lettings – April 2017

Central London office lettings in April 2017 recorded nearly 800,000 sq ft of deals from 41 mid-large size transactions (5,000 sq ft+) during the month.

The April figure represents a fall on the 1.05m sq ft sq ft of lettings in March, but remains close to recent the monthly average.

April was characterised by 13 office deals over 20,000 sq ft, which included Nex Group’s 111,000 sq ft sublet at Fruit and Wool Exchange: Wither’s 60,000 sq ft pre-let at 20 Old Bailey in London, EC4; BUPA taking 56,000 sq ft at Angel Court Tower, London, EC2 and Equinix taking 29,000 sq ft at the Pepper Store in EC2.

Financial services topped the table of lettings by sector, underpinned by the Nex Group deal, this was followed by business services bouyed by the serviced office sector and professional services with large deals involving Withers and DLA Piper. Property and construction also performed well helped by the lettings to M7 Real Estate and Sir Robert McAlpine. Office deals ‘under offer’ in central London rose to 3m sq ft and volumes are rising in nearly all submarkets.

By area, the City accounted for an improved 57pc of the office floorspace let in April at 440,000 sq ft – 50% up on the March level. The West End saw 160,000 sq ft of take-up. Midtown contributed 130,000 sq ft of lettings. Current London office demand is calculated to be around 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 469,000 sq ft (60% of the monthly total), as transactions for new space maintained their recent strong showing.

Cityoffices and Metropolis are shortly to release its twice yearly Skyline report on the London office construction market. The summer report features details 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