The temperatures may still feel more like January than April but in the City lettings market there are signs that things are warming up.
This week an international company took two floors of the 17 storey 200 Aldersgate building close to St Paul’s. This agreement follows take-up by a number of new tenants earlier in the year.
This follows a major refurbishment of the 370,000 sq ft property by new owners Helical Bar which includes a concierge bike storage service and showering facilities. 200 Aldersgate also boasts a basement Virgin Active Gym.
An earlier refurbishment by the previous owners reportedly failed to attract a single tenant, so the current take-up suggests that market conditions are improving. Colin Hargreaves, of Gryphon Property Partners, believes this is the case.
“There are early signs of the general City lettings market picking up and we are approaching a tipping point,” he told the Evening Standard.
However, while these signs are encouraging for landlords, rents in the City have remained pretty static, in real terms, since the crash in 2008.
Hargreaves continues; “Occupiers are still in command for now. For existing space some are driving down rents to extremely low levels.”
Further evidence of both the thawing of the letting market and flat rents can be found in another other recent City letting.
Cameron McKenna solicitors have signed-up to take a 150,000 sq ft space above Cannon Street station for a reported £47.50 per sq ft. However, this is between £10 and £20 less than the developer Hines was hoping for. It is also reported that the law firm is getting a significant rent-free period, suggesting that incentives are still required to attract tenants.
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