The City market is getting year-end nerves at the paucity of big lettings and prelets.
Minerva has about 750,000 sq ft standing empty. Helical Bar has finished a revamp of 350,000 sq ft in Aldersgate. The Heron Tower has loads of space. Hines has nearly finished 400,000 sq ft. Legal & General is impatient to start 900,000 sq ft at Cannon Street. The Pinnacle on Bishopsgate is ready to rocket up to 1,000ft. Tishman Speyer wants a prelet on 760,000 sq ft in Aldgate. Don’t even mention the Shard. Now, both British Land and Land Securities are to build skyscrapers.
This lot adds up to well over 6m sq ft.
How much is needed? The City Corporation says just 8m sq ft by 2026 – just over half a million sq ft per year. Over the next four years, at least twice that much per year will be finished, if you count in The Shard. When will the occupiers stand up and be counted?
Perks reappear
Agents who find it useful to know how other agents are faring might like to read an account of how Bidwells is doing, gleaned over lunch on Monday with Patrick McMahon, who began his four-year term as senior partner at the 430-strong LLP in January.
The affable 45-year-old investment surveyor divides his time between the firm’s small London office and Cambridge, where the heart of this 170-year-old practice lies.
“Not bad at all” is the answer for a firm that operates largely outside the South East. Few staff were made redundant during the credit crunch, when turnover fell by 9% to £32m.
Savings of £1.5m were found from “myriad” sources, says McMahon. “It is amazing how much your costs can rise when things are going well,” he says.
The firm is now in the final stages of setting up a 40-strong office in Milton Keynes and is to open a branch in Oxford. This year has been better than expected, says McMahon, who adds: “But I am a bit worried about next year.” That translates into a budget of similar size and “minimal” pay rises for staff. “But we are bringing back a few perks for the younger staff,” he says.
Sale ahoy!
News of the old Navy HQ in Grosvenor Square: in May 2007, a consortium that included restaurateur Richard Caring paid £250m for the site. Planning permission to build 41 very posh flats was granted last year.
The scheme’s main backer was the Irish Nationwide Building Society. The loan is now controlled by the National Asset Management Agency. And the Irish bad bank is showing UK developers around the site with a view to selling for a lot less than £250m. Gerald Ronson is taking an interest.
One, two, three – and out
Caveat emptor, plus whatever the Latin is for Bluewater. This is the message from a well-known retail agent to the Government Office of Singapore and the various Canadian funds currently vying to buy a 7.5% stake in the Kent shopping centre from Hermes for about £120m.
Why? Three reasons: one, nobody seems to be in charge any more; two, footfall is dropping in out-of-the-way corners as shoppers simply come in, go to the store they want, then leave; three, Westfield’s Stratford Mall will make things worse.
“Why do you think Hermes is selling?” the agent asks. “You surely don’t believe that rubbish about rebalancing the portfolio”
Long time coming
Best wishes to Tony Horrell, the new UK chief executive of Colliers, who left Jones Lang LaSalle after 27 years last December.
At the time, it was reported that the 49-year-old former head of capital markets at JLL was going “client-side”. Instead, Colliers called.
Last week, Horrell got to sit in the chair vacated by David Izett in August. Apparently, this was quite some time after Izett approached Horrell and asked him if he’d like to join Colliers ….
Former EG editor Peter Bill contributes to www.estatesgazette.com/blogs
