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FORE Partnership is a classic

example of how successful

and influential private investors

are in the commercial property

market.

It has completed development

of the 4,459 sq.metres (48,000

sq.ft

.)

VIEW 58 on the Victoria

Embankment which has been sold

to the charity Nesta, for its own

occupation. FORE undertook the

scheme in a joint venture with

Kier Property.

FORE included a number of

new ideas in the building that

apparently have not been used

previously in the UK, such as solar

photovoltaic panels that develop

power from both the top and

underside of the panels.

Basil Demeroutis of FORE said:

“View 58 has been a hugely

successful development for us

and endorsed our responsible real

estate philosophy, which focuses

on low carbon strategies, social

impact, place making and design,

which we believe enhances

rental income and improves

returns”.

FORE is part of an international

trend since it is a pan European

office for family offices and private

investors, reflecting the increasing

global spread of wealth.

Another new arrival to the

London property scene is Lowndes

Estate, part of the Noble

Organisation, a privately owned

leisure operator which has set

out to create a UK property portfolio.

In its first deal it has paid the

Colville Estate £5.74 million for

the 785 sq.metres (8,446

sq.ft.

)

9-13 Cursitor Street in Midtown.

Lowndes’ Edward Flach

commented: “Given the high

occupancy costs in the West End,

Midtown is becoming increasingly

attractive to occupiers and is

therefore an ideal location for us to

launch our investment strategy”.

5

Commercial Property Register

February - May 2017

www.compropregister.com

NEWS

As the reality of complicated

negotiations over Brexit become

more pervasive, so the outlook

for commercial property becomes

cloudier.

There are a host of conflicting

pressures and sentiments fuelling this

uncertainty even though last year’s

take up was in line with the

historical average at 929,000

sq.metres (10 million

sq.ft

.) after a

surge in the fourth quarter with

take up in east London up 8% on

the average.

Neil Prime of JLL said: “The recent

surge of City deals is encouraging

for central London. It demonstrates

that demand has been more

resilient than many feared”.

Another figure points in a different

direction with Deloitte’s Central

London Crane Survey reporting a

42% decline in office construction

starts in the six months to November.

Deloitte’s Chris Lewis commented:

“There is a reaction to political and

economic instability but businesses

are also thinking about their future

needs. We are likely to see lower

rents and more incentives”.

Added to this, Standard Life has

sold properties worth over £350

million since the Brexit vote in order

to rebalance its portfolio away from

the capital. Anne Breen of Standard

Life said: “While we believe there is

long term growth in London we are

also conscious of the need to ensure

our funds are not overweight in the

market near term”.

In fact, the situation is complicated

because another indicator of

confidence is the decision to build a

130,060 sq.metres (1.4 million

sq.ft

.)

skyscraper at 22 Bishopsgate in the

heart of the insurance district, a

financial sector which is expanding

strongly and has taken more space

in the City.

A further encouraging factor is

the resilience and confidence of

small and medium sized businesses.

A report from Albion Ventures for

the UK showed that 73% of small

businesses with over five employees

plan to grow over the next two

years and only 5% expect to shrink

their activities, London was in third

place after the East Midlands and

the east of England.

Backing up this view serviced

office provider, Workplace, said that

demand from SMEs was strong and

rents were continuing to rise. This

office market has grown, partly

because companies like a short term

contract or are wary of the impact of

Brexit and don’t want long leases.

REALITY

check

IN BRIEF

The

strength of the serviced office sector is shown by Office Space in

Town’s 20% rise in revenue to £17.25 million in the first nine months

of 2016, a trebling of revenue in three years. It has brought increased

occupancy rates, a situation shared by other service office providers.

Private

MONEY FLOWS

One of the largest lettings this year

has kickstarted the leasing of

Oxford Properties and Brockton

Capital’s 29,739 sq.metres

(320,000

sq.ft

.) The Post Building

in Midtown.

Indeed, it is a significant letting

because the occupier is McKinsey &

Co which is taking 9,290 sq.metres

(100,000

sq.ft

.) with an option to

increase this by around 30%.

The development of the former

Royal Mail sorting office, due to be

completed summer 2018, is of

importance due to its strategic location

close to the British Museum, the

Royal Opera House and Covent

Garden in what is known as the

knowledge area.

Equally important is the imminent

arrival of the Elizabeth Line in the

area with a station at Tottenham

Court Road. Paul Brundage of Oxford

Properties said: “McKinsey’s move

signifies confidence in London’s

status as an international gateway as

well as the increased importance of

Crossrail-connected creative hubs

as a home for vibrant professional

services firms”.

MCKINSEY IN

Midtown

Paul Brundage