2013 Q1 London Midtown Office Leasing market update
2013 Q1 London Midtown Office Investment market update
(Entertainment-NewsWire.com, May 21, 2013 ) London, UK -- Offices in London’s Midtown returned 8.7% in 2012, one of the highest returns of any European office market, and, alongside the West End’s return of 10.6%, underlines Central London as one of the leading office investment markets in Europe.
According to the latest Farebrother IPD London Midtown Investment Report, Midtown’s offices recorded a higher return than the City (7.5%) for the first time in three years. Capital values in the City grew by 2.1%, against 4.1% in Midtown, where rental growth of 4.4% drove returns.
This was largely as a result of corporate occupier relocations, renewals or expansions on secondhand and refurbished commercial property space in London which has fuelled Investors’ bids in this core global market while many other UK locations struggled to stay positive.
2012 occupier moves in Midtown include Skype’s Acquisition of 88,000 sq ft at Waterhouse Square, EC1, the 46,000 sq ft taken by LinkedIn at Castlewood House, New Oxford Street, WC1, Warner Bros’ renewal on 133,000 sq ft at 98 Theobald’s Road, WC1 and Stewarts Law’s growth into a further 23,191 sq ft at 5 New Street Square, EC4.
Greg Mansell, IPD Head of Research, said “Strong occupier demand has been a major driver of growth in the London office markets for the last 12 months – it has not only been the weight of overseas capital that has driven up values. Midtown has benefitted by attracting a diverse mix of tenants that offers a considerable degree of income security, which is all important to investors in the uncertain economic environment.”
Julian Hind, Farebrother’s Head of Leasing, Sales & Development said “Midtown’s office availability rate had fallen to 4.1% by the end of the 1st Quarter 2013, lower than the City at 8.9%, Southbank at 6.9% and the West End at 5.5%, and this is despite the lowest quarterly take-up in the market for ten years.”
Alastair Hilton, Head of Investment at farebrother commented “Market dynamics in Midtown – good accessibility, low availability and a diverse occupier base - are strong and sustainable and when seen alongside the completion of Crossrail on two gateway sites, which will bring a further 1.5m people within a 45 minute commute of Midtown, the investment case is compelling.”
About Farebrother:
Farebrother is an entrepreneurial and experienced firm of commercial real estate advisors. The firm is privately- owned, established in 1799 and is headquartered in London, England. Farebrother delivers responsive office, industrial, residential and retail leasing and investment acquisition and disposal, property management, lease advisory, valuation and corporate services across the UK, for leading Fund, Institution, Developer, Occupier and Private clients. Farebrother is the UK Affiliate of CORFAC, the global independent agency network and is regulated by the Royal Institution of Chartered Surveyors.
