Amazon is set to become the biggest occupier in the tech heartland of Shoreditch as it homes in on a major prelet at Brookfield’s Principal Place, EC2.
The online retail giant is in advanced talks to lease at least two-thirds of the 600,000 sq ft, 15-storey office block.
The talks come just two years after the company signed for the entire 210,000 sq ft office element of AXA Real Estate’s Sixty London development on Holborn Viaduct, EC1, committing it to the building for at least 10 years.
It had hoped to build a Midtown campus of up to 1m sq ft over the next decade.
However, the dearth of suitable space being developed in the area close to its existing home forced the company to rethink its plans.
Eric Pickles’ decision to reject TIAA-Henderson Real Estate’s proposed redevelopment of Smithfield market last week means there are now almost no sizeable office blocks being developed in close proximity to Sixty London that are available and can be delivered within the next few years.
Amazon is not yet under offer on the development, but it is thought to be on the verge of agreeing terms.
The mixed-use Principal Place attempts to straddle the distinctly different characters of its northern and southern borders, reflecting Amazon’s contrasting reputations as both a large corporate and an innovative online company.
Glass and steel city campus Broadgate abuts the scheme to the south, with low rise, trendy Shoreditch to the north.
Principal Place is expected to attract rents of around £52.50 per sq ft.
A source said: “This scheme was made for Amazon. It is a grown-up building but it is in a great location for a tech giant.”
Brookfield acquired the development via its £518m purchase of Hammerson’s office portfolio. It has since sold a half stake in the 50-storey, 243-flat residential element of the scheme to Concord Pacific.
Hammerson had prelet around a third of the office element of the scheme to CMS Cameron McKenna in 2011 but the law firm tore up the agreement the following year amid uncertainty surrounding its future space requirements.
It has since taken a smaller chunk of space at Cannon Place, EC4.
Cushman & Wakefield advises Amazon; Allsop and C&W are letting agents at Principal Place.
jack.sidders@estatesgazette.com
