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June 20, 2012

Brookfield snaps up £500m worth of London offices

Filed under: News — Tags: , , — Office Space @ 6:00 am

A Canadian developer has snapped up more than £500 million worth of office space in London from Hammerson, with the massive efforts spearheaded by former Hammerson boss, Martin Jepson.

Mr Jepson, who left Hammerson in 2011 to join Brookfield, is working hammer-and-tongs to achieve the Canadian developer’s goal of building up a city office space portfolio that tops £5 billion. Hammerson had been in talks with Brookfield for quite some time in regards to the office space sale of its London offices, with Hammerson restructuring its business to place a higher concentration on retail assets such as its Brent Cross shopping centre.

Brookfield spent a sum of £518 million for around 75 per cent of Hammerson’s properties currently up for sale. Properties to change hands include 125 Old Broad Street and 99 Bishopsgate. The Old Broad Street location has been a thorn in Hammerson’s side, with the developer having to spend resources to repair the building’s glazing problems in the wake of glass panes falling from the building’s windows.

Other properties changing hands include the Principal Place development site as well as Leadenhall Court. The former, which has office space planning permission for 57,000 square feet of offices in addition to a rental tower, had been reluctantly put up for sale by Hammerson after potential tenant CMS Cameron McKenna got cold feet in the early months of 2012.

Hammerson is left with only a few remaining assets within London, though the developer is hoping to parcel them off over the next year and a half.

June 15, 2012

Local authority poised to reorganise its commercial premises

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Calderdale Council is poised to undertake reorganisation efforts in order to sell off its excess and no longer fit for purpose office space, it was recently reported.

Any and all council-owned commercial premises in Halifax are currently being examined in order to determine which of them will be modernised and refurbished and which will be sold off. The budget for the modernisation scheme stands at around £12 million and is designed to make it possible to enable around 1,000 public sector workers who currently have positions in Halfiax town centre, and will make it £7.5 million less expensive to maintain the buildings over the next quarter century – with an additional £1.2 million in savings every year thereafter.

The new office accommodation proposals will be voted on early next week by Calderdale Council Cabinet. If approved, the council will, over time, vacate its offices at the Elsie Whiteley Centre, Park Road, the Hoover Building, Horton House, Dean Clough, and Northgate House in order to complete the renovations and dispose of any unwanted buildings in office space sales.

Tim Swift, Calderdale Council leader, remarked that the new plans are representative of a perfect solution for Halifax, as they will benefit the local economy and local businesses by keeping jobs within Halifax town centre. Janet Battye, the council’s deputy leader, agreed, remarking that the local authority wishes to keep its office buildings within the area, as it will make it easier for local residents to get in contact with the council if needed.

April 25, 2012

New Leamington scheme seeks to revitalise the area

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A speculative investment scheme in Leamington seeks to bring new life to the region by enticing businesses to relocate to new office space in the area, industry experts say.

Property development firm, Hatchback Ltd, has purchased the former Law Society offices at Victoria Court, in Dormer place, and says that the company has already been receiving interested calls from businesses interested in relocating to the landmark building. Hopes run high for the developers of the new project that businesses moving into the new, modern commercial premises will help drive economic recovery by boosting job prospects for those living and working in Leamington.

Hatchback Ltd, founded by chairman Shalbinder Malle alongside his son Hardeep, who is also the firm’s managing director, purchased the 33,000 square foot commercial office space building from the Law Society in March.  The Society, which moved its staff to Birmingham, no longer houses the Office for the Supervision of Solicitors, no longer had need of the edifice, and demand has been so high for the newly-vacated building that fully 50 per cent of Victoria Court is already under offer.

Wareing & Company, the property agents acting for Hatchback in the office space sale, is hoping to fill the remainder of the building’s vacancies before the end of April.  One director for the property agents, Mark Thompson, remarked that Hatchback has a strong track record within the Leamington marketplace, acting as an excellent indicator that Victoria Court would continue to attract high levels of interest.

April 19, 2012

East Yorkshire region experiencing office space take up boom

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The East Yorkshire region is experiencing an office space take up boom that shows no indications of abating any time soon, a local property agent recently remarked.

January saw a record number of commercial office space deals undertaken in East Yorkshire and Hull, according to PPH Commercial.  The property agents, which operates out of Hesslewood Hall, located in Hessle, said that they had disposed of in excess of 60,000 square feet of commercial premises in the last few weeks of 2011.

PPH Commercial partner, Nick Pearce, spoke earlier this year, stating that all expectations had been surpassed in regards to the level of office take up last year.  This remarkably high level of activity has continued through 2012’s first quarter, Mr Pearce said more recently, adding that while last year saw little action from smaller firms looking for space, this year has seen a large increase in demand from SMEs.

PPH completed several deals this quarter, including ones in Anlaby at McMillan House and Faraday House.  Meanwhile, Hull City Centre’s Broadway House has let offices this quarter, and two Welton-based office properties have been purchased in an office space sale as well, and the last Albion Mills office suite has been let as well.

The property agent also sold offices in Livingstone Road, Hessle, at 11 Waterside Business Park.  An additional seven buildings have been placed under offer, Mr Pearce reported, with the sales expected to be finalised over the coming weeks, and the property agent partner indicated that both new businesses and expanding ones were increasing their demand for commercial space.

February 2, 2012

Harrogate Borough Council may sell Leeds office space

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Harrogate Borough Council is currently considering the sale of a large portion of its Leeds office space in order to relocate to a more centralised location in an effort to reduce carbon emissions, commercial premises experts recently reported.

Wallace Sampson, chief executive of Harrogate, is a member of the new Leeds City Region Green Panel, and has expressed his desire to undertake an office space sale in order to cut office emissions from local authorities by 40 per cent by the end of the decade.  Mr Sampson said in a recent interview in the Yorkshire Post that there are several ways to minimise environmental impact in the region by examining the way the local authority buys energy and fuel and the buildings that the council occupies.

As much of a money saving strategy as an environmental strategy, the office space move will enable the local authority to operate in a much more environmentally sustainable manner, added the chief executive.

Harrogate Borough Council has already demonstrated their dedication to sustainability, as it has already equipped local exhibition halls with a range of renewable power sources and implemented a 50 per cent to 70 per cent reduction in emissions through the use of heat pumps.  The relocation proposals would follow in the footsteps of several other local authorities that have already made efforts to commit to more ecologically sound operations.

Harrogate Borough Council was to discuss the possibility of the office space sale this week during a cabinet meeting, experts say, with the results of the meeting being made public sometime later.

January 2, 2012

28/29 Savile Row changes hands in office space sale

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Commercial premises in the W1 postcode has recently changed hands in an office space sale with a £16.25 million price tag, industry experts recently reported.

Office space at 28/29 Savile Row was recently sold to Allied London LLP and Aerium Finance Limited from its former owners, Great Portland Estates, for an approximate price of £1,107 per square feet for the nearly 16,000 square foot building.  Situated in the centre of London’s West End, the office space in the building is currently unoccupied, offering opportunities for refurbishment, while its accompanying retail space is currently producing an annual rental income of £200,000, with The Pollen Estate holding a long lease on the retail accommodation.

Great Portland Estates’ investment director, Ben Chambers, commented on the sale, remarking that it is a continuation of the firm’s capital recycling strategy in regards to its smaller scaled properties.  While Mr Chambers did acknowledge that the Savile Row location did offer excellent opportunities for refurbishment, the focus of the team is towards larger schemes that would have a greater impact on the London market, especially in light of Great Portland Estates’ other acquisitions over the past year and a half.

The new owners of the building, Allied London LLP and Aerium Finance Limited, are yet to announce their refurbishment plans for 28/29 Savile Row.  However, industry experts say that with the impending shortage of Grade A listed office accommodation looming on the horizon, headline rents are poised to rise precipitously as supply quickly outstrips demand, making a refurbishment a nearly foregone conclusion for the new acquisition.

December 19, 2011

£82.7m office space sale takes place in London’s Midtown

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An £82.7 million office space sale has taken place in London’s Midtown, with private investment firm GI Partners, in conjunction with Rowan Asset Management, acquiring 163,000 square feet of office space at Aldwych House.

With debt finance provided by Nationwide, the transaction was funded with investments coming from Taurus Investment Holdings and with capital provided by GI Partners.  Built in 1926, Aldwych House, which has 89 per cent of its commercial premises currently let to 11 occupiers over its ten storeys, was last renovated 23 years ago.

Existing occupiers include solicitors Manches, the London School of Economics, and Associated British Ports. A major refurbishment will be overseen by Rowan, acting as asset manager, and will result in rebranding the offering with common areas and an iconic modern entrance as material improvements for the current tenants.

GI Partners managing director, Brad Altberger, commented on the new acquisition, calling Aldwych House an ideal opportunity for high quality asset investment in the office market in central London.  The deal saw Aldwych House purchased at just slightly more than £500 a square foot, leading Mr Altberger to believe the downside is well protected, while addtitionally believing that significant upside potential exists as the building is currently let below market price in regards to rental prices.

In addition to the purchase of Aldwych House, the managing director is also actively undertaking a search for similar targets for acquisition, indicating that their fund still has substantial amounts ‘of dry powder’ in order to execute a strategy of purchasing other sites with the requirement of intensive asset management.

December 10, 2011

£27m office space sale made in City of London

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A £27 million office space sale was made recently in the City of London, with Trinova Real Estate, on behalf of a client, acquiring 155 Fenchurch Street from Walbrook Land and the Palmer Capital Development Fund.

With nearly 43,000 square feet of City office space, the building, situated within the heart of the insurance district in the ‘Lloyds Triangle,’ also has ground floor retail space as well.  The property houses such names as Carphone Warehouse, Eat, Norman Butcher Jones, Twenty Fenchurch Street, Prime Professions, and Jardine Lloyd Thompson, and the sale of the office space follows on the heels of Palmer Capital’s sale of Bristol’s ‘The Paragon’ for £26.5 million to Invesco Real Estate.

Palmer Capital’s chief executive, Alex Price, commented on the deal, remarking that this is the conclusion of a programme of disposal undertaken this year by the fund to capitalise on market strengths for quality, well let, and prime office accommodation.  Palmer Capital now has more than £150 million available for the next two years, which puts it into an excellent position for future purchases in a market with a high likelihood of seeing further distress, Mr Price also said.

Walbrook Land director, Tim Stotesbury, also said that the firm’s Fenchurch Street redevelopment completely transformed a property that had been compromised from 25 years of use into modern, first class accommodation, attracting some of the highest quality tenants within the insurance district.  Walbrook Land now seeks to acquire properties similar to Fenchurch Street in order to bolster its development pipeline, the firm director also said.

November 6, 2011

Edinburgh office space sale raises £37m for council

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An Edinburgh office space sale has raised more than £37 million for the city council, according to industry insiders.

The collection of 14 vacant office space buildings was sold off in the wake of the 2006 relocation to Waverley Court at Market Street, which is now the new council headquarters.  The cost cutting measure saw 1,600 staff members relocating from several sites throughout the city to a single centralised location.

Net profits from the sale totalled £37.4 million, sending the signal that the Waverley Court move was worth it, as the office space rental costs for the new site is estimated at £24.8 million inclusive of relocation and loan expenses.

Cllr Phil Wheeler, finance leader for the city, remarked that the move to Waverley Court was a key component to the council’s strategy to ensure it made the best possible use of its properties.  The council both freed up prime cites within Edinburgh city centre for new businesses and saved millions of pounds by bringing staff together in one centralised, modern location, Mr Wheeler added.

Quite a few of the properties that have been sold have been refurbished into new developments over the past few years.    The Mound Property Company purchased Lothian Regional Council’s headquarter office on George IV Bridge, transforming it into the Hotel Missoni, in one example of these council buildings being re-purposed for the commercial sector.

However, due to developers reluctant to invest in new projects and the continuing financial pressures that have accompanied the 2008 credit crunch and resultant global economic downturn, there are some buildings that have remained vacant.

October 30, 2011

Ikea spends £25m in 27 acre East London office space sale

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One flatpack furniture giant has recently made a purchase of 26 acres in East London in a £25 million office space sale designed to provide around 480,000 square feet of commercial office space.

Scandinavian furniture retailer Ikea has announced plans to add a ‘flat pack city’ to its first property development in the UK.  Called the ‘Strand East’ project and located in Stratford, the new suburb will contain office space, retail accommodation, a 350 room hotel, and 1,200 residential homes.

Ikea claims that, since the development will be situated alongside a canal, it will be akin to a miniature Venice, featuring a floating cocktail bar.  The entire site is designed to be as environmentally friendly as possible, as it will be interconnected with walkways especially designed for pedestrians, with taxi services and transport provided by boats, with a hydroelectric power plant providing rubbish removal and the development’s energy requirements.

Boris Johnson, the Mayor of London, remarked that this is just one more wonderful example of the legacy the 2012 Olympic Games will bring to East London.  The early days of 2012 will see the planning application for the new site submitted, and the development arm of Ikea, LandProp, will have responsibility for the move into the property market and the new scheme.

Managing director Harald Muller stated that the site would be both the most interesting and newest development in the entire area.  The project comes on the heels of reports that office accommodation demand in the city has remained stagnant, with the total amount of square feet leased within the capital has slowed to a crawl in London’s financial hub.

Despite this, new reports have shown that, while offices in the West End have been lagging, East central London take up has surged due to the relative affordability of the area’s rental prices.

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