Welcome to the combined 1st to 3rd quarter update of 2020, with an up-to-date view of the commercial property market in West London. Featured in this issue: Market Summary, Take-Up, office supply & rents at a glance, The Sale of White City Place & Westfield London’s House of Fraser office conversion.
MARKET UPDATE Q1 to Q3 2020 – Commercial Property News West London
In Q3, the Government set up the Hammermith Bridge Taskforce to consider the various stabilisation and repair options for the Grade II listed, 133-year-old, cast-iron Hammersmith Bridge. Some of the short term options include a ferry, which is currently the preferred option, or a temporary bridge for pedestrians and cyclists.
TAKE UP – Commercial Property News West London
Government guidance has discouraged many larger businesses from relocating their office this year. There was a brief ‘return to office work’ statement from the Government in Q2 but in Q3 and Q4 the Government is encouraging employees to work from home if they can. As a result many businesses have put office relocation’s on hold until next year. We have however noticed that some businesses are choosing to relocate offices west of the centre to save costs. Many company directors are often based around west London rather than central London and can thereby reduce their commute.
Some companies are downsizing, either due the recession or to a perception that more agile working will continue after the COVID 19 crisis, meaning less office space will be required generally. As a result, take-up has been low across west London.
HAMMERSMITH & FULHAM – Commercial Property News West London
Take-up has been just 146,155 sq ft in the year to the end of Q3 2020. At the same time in 2019 take-up was 425,000 sq ft, almost 3 times greater.
- Alvogen, a pharmaceutical company leased 5,300 sq ft at Frost Meadowcroft’s client Kings House, 174 Hammersmith Road in Hammersmith, W6 for £56 per sq ft.
- Sybarite architects, took an additional 4,000 sq ft on the 4th floor of The Aircraft Factory, Ravenscourt Park, W6 whilst also renewing their lease on the 5th floor giving them a total of 9,000 sq ft.
- The Romanian Embassy took Frost Meadowcroft’s client, Romulus’ 8,300 sq ft 1st floor of Glen House, 22-24. Glenthorne Road, Hammersmith, W6 at £42 per sq ft.
- Armit Wines, fine wine merchants, leased Romulus’ 2,457 sq ft 2nd floor, The Triangle, 5-17 Glenthorne Road, Hammersmith, W6 at £30 per sq ft.
- Softline, the software company, took 2,000 sq ft of fitted space at 26 & 28 Hammersmith Grove, in Hammersmith, W6 for £45 per sq ft.
- Engitix Therapeutics, a drug discovery firm, has leased 8,000 sq ft at WestWorks, White City Place, W12 at £57.50 per sq ft.
- Quell Therapeutics moved to Imperial College’s I-Hub, 80 Wood Lane, W12 taking 11,974 sq ft of office and lab space at £55 per sq ft.
- Dun & Bradstreet, the commercial analytics company, leased 23,108 sq ft, 2nd floor of The Point, 37 New Wharf Road , Paddington Basin at £60 per sq ft in Q1.
- Stats Perform, a sports prediction company also leased space at The Point taking the ground floor for £55 per sq ft.
- Address Intelligence, a marketing company, leased 7,717 sq ft ground & lower ground floors of 6 Salem Road, Bayswater at £40 per sq ft.
Commercial Property News West London
WHITE CITY PLACE SALE
The freehold investment and sales market has been less affected than the occupation market as purchasers can look beyond the current COVID 19 crisis and take a longer term view.
Canadian pension and property company, Cadillac Fairview, has bought White City Place, the 12 acre 1m sq ft, former BBC scheme in West London, (just north of BBC TV Centre) for around £235m, a 3% yield.
Cadillac Fairview is a real estate company owned by the Ontario Teachers’ Pension Plan that administers the pensions of more than 327,000 active and retired schoolteachers. It has bought Stanhope, AIMCo and Mitsui Fudosan’s controlling leasehold which runs on the estate until 2035.
White City Place includes the multi-let office buildings, Media Works, WestWorks and the Garden Building as well as the Broadcast Centre, Energy Centre and Lighthouse which are still let to the BBC until 2035.
Frost Meadowcroft have 3 clients in White City Place. Global Brands Group and sister company Li & Fung, provide marketing and manage the logistics of fashion labels including Calvin Klein, Disney, Katy Perry and brand management for celebrities such as Jennifer Lopez and David Beckham. The other companies are Jellycat, a soft toy company, and Arts Alliance Media, a leading software solutions provider to cinemas, all of whom are occupiers of WestWorks.
The sale excludes the Gateway development site, where L’Oreal is taking 124,000 sq ft of offices and which has consent for a further 900,000 sq ft of office space.
In Q2 the owners of Westfield London and clients of Frost Meadowcroft, Unibail-Rodamco-Westfield, obtained planning consent to convert the current House of Fraser into 68,000 sq ft of office space together with 32,000 sq ft of new retail space across two units.
A short walk from Shepherds Bush station, it is an ideal office location and Frost Meadowcroft have begun the process of securing a pre-let.
Westfield London was always a multi-use destination and as shopping patterns change the centre continues to evolve. Other ‘non’ retail users are the expanded 97,000 sq ft Vue Cinema, the 90,000 sq ft HQ of Net-a-Porter, the fashion technology business, the 61,000 sq ft KidZania, the children’s entertainment centre, the 40,000 sq ft multi-let office building at One Ariel Way and the 34,000 sq ft Exhibition London, a new music events and hospitality venue in the Dimco Buildings.
Westfield London has more than 60 restaurants, bars & cafès. In addition there is a block of 90 rented flats and planning consent for a further 1,700 residential units in a private rented sector scheme.