Metropolis Office Movers in March 2018

Metropolis ran 621 business leads on ‘office movers’ in March 2018. If all reported moves were added together the total would exceed 20 million sq ft of office searches and transactions, researched by Metropolis’ unique market led intelligence research team. London was the largest region with 275 business leads during month, but there were also strong showings from the South East (72),  North West (44), Yorkshire (43) and Scotland (26) .  Financials services were the 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, company 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 621 March leads, included those on occupiers Bank of America, Cleveland Clinic, BT, Morgan Stanley and PWC.

The March 2018 leads included 160 ‘identified requirements’, including 81 in London. Which means that the company confirmed to researchers that it has current or future plans to search for alternative office space. Of these 156 searches, 102 were new office searches, not previously notified to clients.

The most recent research also included 198 ‘potential movers’ which were mainly longer-term leads on occupiers, considering a relocation, but the occupier has yet to make a final decision on whether to search.

Most of the remaining stories covered companies that have just 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.

Recent research by Metropolis concluded that a conservative estimate of ‘live’ business tender opportunities on the database in recent months, exceeded £1bn of business.

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

Advertisements

Thames Valley Office Market Update

JLL’s just published Western Corridor office market report concludes that the Thames Valley enjoyed a solid start to 2018. Take-up across the region totalled approximately 516,000 sq ft, representing an increase of 31% on the corresponding quarter of 2017.

The first quarter of 2018 was characterised by smaller deals, according to JLL. The the majority of activity (80%) taking place in the 10,000 sq ft to 50,000 sq ft size band. Deal numbers increased by 50% from 24 deals in Q1 2017 to 36 deals in Q1 2018.

Metropolis reported on over 30 planned relocations in the M4 corridor in Q1 2018, such as FM Global taking 57,000 sq ft at Voyager Place in Maidenhead; Black+Decker taking 49,000 sq ft at 270 Bath Road, Slough; Panasonic taking 41,000 sq ft at Maxis office scheme in Bracknell; Fora Space taking 28,000 sq ft at Thames Tower, Reading; JDA Software taking 23,000 sq ft and Riverbed Technology 16,000 sq ft at Maxis office scheme in Bracknell; GiffGaff taking 23,000 sq ft in Uxbridge; Quest Software taking 13,000 sq ft at Arlington Square, Bracknell and MBNL at Thames Tower, Reading.

JLL say that supply of office space is flattening, falling below 10m sq ft and this is expected to moderate further over 2018.  JLL also think that availability will decline in 2019 and 2020 as the number of active speculative development schemes reduce.

James Finnis, head of south east office agency at JLL, said: “The Q1 take-up figures represent a solid start to 2018. The 50% increase in the number of deals in Q1 illustrates growing occupier confidence. Occupiers are focused on the best space and there is widespread evidence of tenants trading up but taking less overall sq ft. Flexibility remains important with occupiers wanting to build in options to either grow or downsize. The addition of serviced or co-working space into multi let buildings is a natural extension of this, providing on site swing space.

Metropolis is currently tracking around 50 office searches of various sizes along the Thames Valley and talking to over 100 occupiers with approaching lease expiries in the area.

 

February 2018 Central London Lettings

Central London office lettings in February 2018 reached just over 1m sq ft of deals from 50 mid-large size transactions (5,000 sq ft+) during the month. The February 2018 figure is in line with the current monthly average of 1m sq ft.

February was characterised by 11 office deals over 20,000 sq ft, which included Sumitomo’s 161,000 sq ft re-letting at 100 Liverpool Street, EC3; Sidley Austin’s 135,000 sq ft pre-letting at 70 St Mary Axe, EC3 and Prudential took 59,000 sq ft at Angel Court Tower, EC2.

Financial Services topped the table of lettings by sector, underpinned by Sumitomo and Prudential deals. This was followed by professional services mainly underpinned by the signing of the Sidley Austin pre-let. Office deals ‘under offer’ in central London stayed at 3.5m sq ft, but pending deal volumes are healthy in nearly all sub-markets, with over 30 deals pending.

By area, the City accounted for 50pc of the office floorspace let in February 2018 at 501,000 sq ft. The West End saw 266,000 sq ft of take-up. Midtown contributed 66,000 sq ft of lettings, plus 143,000 sq ft of Docklands deals. Current London office demand is calculated to be around 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 557,000 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 655 ‘live’ London requirements, with deals for space of up to 1.9m sq ft due to sign in the next few months.

Cityoffices is working on its current ‘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 the report and the Cityoffices database from Andy King at andy@metroinfo.co.uk

Metropolis Office Movers in February 2018

Metropolis ran 528 business leads on ‘office movers’ in the slightly  shorter month of February 2018. If all reported moves were added together the total would exceed 15 million sq ft of office searches and transactions, researched by Metropolis’ unique market led intelligence research team. London was the largest region with 235 leads during month, but there were also strong showings from the South East (50),  North West (48), Scotland (42) and Yorkshire (41).  IT and business services were the 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, company 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 538 February leads, included those on occupiers Facebook, Anixter, Dar Al Handasah, Novartis and CAF Rail.

The February 2018 leads included 156 ‘identified requirements’, including 82 in London. Which means that the company confirmed to researchers that it has current or future plans to search for alternative office space. Of these 156 searches, 100 were new office searches, not previously notified to clients.

The most recent research also included 151 ‘potential movers’ which were mainly longer-term leads on occupiers, considering a relocation, but the occupier has yet to make a final decision on whether to search.

Most of the remaining stories covered companies that have just 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.

Recent research by Metropolis concluded that a conservative estimate of ‘live’ business tender opportunities on the database in recent months, exceeded £1bn of business.

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

Central London office lettings in January 2018

Central London office lettings in January 2018 reached a slightly downbeat 850,000 sq ft of deals from 46 mid-large size transactions (5,000 sq ft+) during the month. The January 2018 figure slightly underperforms the current monthly average of 1m sq ft.

January was characterised by 14 office deals over 20,000 sq ft, which included Google’s 127,000 sq ft re-letting at Building R7, Handyside Street, Kings Cross; Mimecast’s 78,000 sq ft letting at Finsbury Avenue, EC2 and Dell took 23,000 sq ft at Creechurch Place, EC3.

Media topped the table of lettings by sector, underpinned by Mimecast and Intuit deals. This was followed by IT services and business services mainly underpinned by serviced office operators. Office deals ‘under offer’ in central London rose slightly to 3.5m sq ft, but pending deal volumes are healthy in nearly all sub-markets, with some 40 deals pending.

By area, the City accounted for 34pc of the office floorspace let in January 2018 at 291,000 sq ft. The West End saw 228,000 sq ft of take-up. Midtown contributed 236,000 sq ft of lettings, plus 90,000 sq ft of Docklands deals. 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 433,000 sq ft (51% 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 635 ‘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 current ‘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 the report and the Cityoffices database from Andy King at andy@metroinfo.co.uk

 

Birmingham Breaks 1m sq ft

Colliers has just published its latest report on the Birmingham office market.

It reveals that Central Birmingham office take-up in Q4 2017 totalled 354,530 sq ft in 49 deals, taking the annual total past 1 million sq ft for the first time. The total was boosted by the 239,000 sq ft pre-let by the UK Government (GPU) at 3 Arena Central in Q3. The year-end take-up totalled 1,005,072 sq ft in 130 separate deals. Further GPU requirements are also in the pipeline for the next five years as departments including Ministry of Justice and DWP also seek to consolidate and upgrade their regional offices in Birmingham.

Amongst the largest Q4 lettings, IWG (formerly Regus) secured 76,000 sq ft of offices at Crossway on Great Charles Street, as well as 33,300 sq ft of the newly refurbished Lewis Building. Co-working operator iHub signed for 18,000 sq ft at Colmore Gate and MSO Workspace took 9,850 sq ft at 11 Brindleyplace. Serviced office providers are catering for a growing demand from banking, outsourcing and infrastructure clients who seek a flexible occupational solution as a result of investment by HSBC and HS2.  In addition, PwC took an additional pre-let of 58,631 sq ft at Two Chamberlain Square to add to the 90,000 sq ft it took at the scheme in 2016. Metropolis also reported that Spark44 took  14,176 sq ft at Norfolk House and The Princes’s Trust, took 1,773 sq m (18,980 sq ft) of offices at the Beorma Quarter. Recently, engineering consultancy firm WSP signed for 47,000 sq ft of refurbished space at Mailbox for its West Midlands regional headquarters.

On the supply side, Three Snowhill (420,000 sq ft) and 1&2 Chamberlain Square (232,000 sq ft) are due for completion by late 2019. The 42-acre Birmingham Smithfield is due to be redeveloped into over 3 million sq ft of commercial space, and in Edgbaston, there is consent for a £300 million regeneration of a 10.7-acre plot along Hagley Road. by Calthorpe Estates and U+I, known as New Garden Square, which could potentially deliver more than 600,000 sq ft of office space.

Metropolis is monitoring 50 companies searching for offices in the Birmingham area and nearly 60 companies approaching lease decisions over the next two years.

London Office Market Analysis

Estates Gazette has just published in analysis of the London office market in 2017. The main conclusions include:

 

  • Total central London office take up was 12.6m sq ft (all deals) which was up around 2m sq ft on the 2016 total in a relatively strong year and just above the five year average;

 

  • The City core saw just under 3.6m sq ft of deals in 2017, together with 1.8m sq ft in the City fringe. Both figures are down on previous years;

 

  • Lettings in the Midtown, West End and Southbank areas were strongly up by over 40% last year;

 

  • Lettings of Grade A space were up strongly at 52% of all lettings in 2017, compared to 42% in 2016;

 

  • Overall, TMT was the most active sector in 2017 as a whole, accounting for more than 27% of all lettings. The five biggest deals in the quarter were from the TMT, Central and Local Government, Property, and Financial sectors. A proportion of small and medium sized occupiers are being absorbed by serviced office space;

 

  • Some 3.7m sq ft of new office space was started in 2017, but this compares with an average of over 5m sq ft of starts in 2015 and 2016. This means there are lots of speculative completions coming through, which in turn in driving higher take-up;

 

  • Around 8.3m sq ft of new London office completions are planned for 2018 (a ten year high), with over 6.3m sq ft of completions already planned for 2019;

 

  • Overall London office availability has risen from 4.3% in 2015 to 7.4% in late 2017, driven by a rise in secondhand space that now stands at 12.4m sq ft;

 

  • As a result rents overall are edging down, which could encourage more occupiers to relocate;

 

  • 2018 take-up in central London is likely to be driven by new build deals;

 

Metropolis forecasts that the rising volume and proportion of new build letting transactions will sustain the fit-out and office equipment supply markets in 2018-19.

Cityoffices.net forecasts a strong pipeline of new schemes (there are over 200 in the pipeline of 20,000 sq ft or more) seeing construction starts in 2018.