A full commercial property recovery will not happen for around five years, because of the prevalence of lower grade schemes that are “mired in debt”. That’s the view of some is commercial property sector experts who believe that the current bubble in prime London schemes is masking a much graver picture nationally, particularly with regard to lower quality property in less desirable locations.
London Office Space prices could drive investors overseas
Madrid and Frankfurt could be the benefactors if prices for commercial property in London continue to rise. That’s the view of some leading commercial property experts in London who fear that the boom in prices in London could be driving some overseas investors away. However the price boom is of course beneficial in other areas as it will help bolster rental values.
New Tower for London Students
Private Equity company Blackstone are scheduled to build a new residential Tower block in the City of London, not for bankers and financiers, but for students, mainly from overseas. The company have been involved in the UK student housing market for four years now, and have invested over £400 million in the booming market. Despite the worst recession for a generation, rents for premium student housing in desirable areas have been rising, fueled by wealthy overseas students.
West End Office Space most expensive once again
The West End of London is once again crowned the most expensive area to rent office space in according to new data from commercial property experts. It seems the prestigious part of West London has overtaken Tokyo to be the most expensive global office district. The average West End office rent is now around £115 per square foot, around £5 more than in the inner district of Tokyo.
Canary Wharf Group 5 Churchill Place
Canary Wharf group, who own over 8 million sq ft of workspace, is to sell £208 million worth of office space in London. The group are to sell 5 Churchill Place in London’s Docklands to a private investor in the Bahamas. The price is almost one fifth higher than the book price cited earlier this year. The amount is indicative of the boom in London commercial property, fueled by the weakness of sterling and rock bottom prices.
Hammerson close to two pre lets in London
Hammerson are in talks over two possible pre let agreements at two office locations in London. The company have revealed strong interest from banks and financial institutions, fueled by an improving economic climate and a limited supply of new stock. Because developers have not been able to access lending as easily as before the crunch, the availability of new stock has been reduced. But, the fact that Hammerson are engaging with potential occupants has given reason to cheers to developers who want to create new schemes in the Cityof London.
London Office Market in 2010
The London office space market is one of the most important commercial property markets in the world. With such a high volume of office space and with so many major companies having a presence in the capital, many will be keeping a keen eye on it in 2010. Under the pressure of the recession, rents and capital values have tumbled from the heady days of the 2007 boom. In areas such as the West End, rents have fallen by as much as 40%, with the overall fall in London office rents estimated to be around 28% in 2008.
Regeneration threatened by Crossrail levy say local councils
The Mayor’s plans to levy a charge on all large central London office developments to help fund the crossrail project are subject to an official hearing. That hearing has heard evidence from Southwark and Lambeth Council who say that areas south of the river should be exempt from the tax. The mayor hoped the levy will raise £300 million on new office blocks over 5,000 sq ft. The Mayor has refused exemption for the Elephant & Castle despite agreeing to exempt the Vauxhall, Nine Elms and Battersea area from the levy.
Minerva sign new tenants as takeover rumours continue
Minerva, the London based landlord said this week that it had successfully let 145,000 square feet of space at the St. Botolphs development. The company have also been trying avert a hostile takeover from Nathan Kirsh’s, a South African businessman. The deal would cost around £85 million. The leasing deal is with Clyde & Co and will last 20 years, with a starting rent of £48 per sq ft, with a 36 month rent free period. Major lettings can still command generous rent free periods it seems.
London Offices News and Views
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