Retail giant Marks & Spencer is preparing to sublet space in one of the three buildings it occupies in Paddington, W2, as it makes staff cutbacks and streamlines its business.
The company is reviewing options on 160,000 sq ft of space at European Land’s 5 Merchant Square, W2, part of European Land’s Merchant Square scheme, and has invited agents in to pitch.
M&S signed at the space in 2008 on a 30-year lease, paying a rent of close to £53 per sq ft. Average Paddington rents are currently around £65 per sq ft.
The pitch comes after M&S cut 525 office-based jobs in London last year.
It has also moved another 400 roles outside the capital to its IT centre in Stockley Park, Middlesex, and its distribution hub in Hemel Hempstead, after chief executive Steve Rowe announced plans to simplify the business.
M&S also announced in November last year that it would close up to 30 shops.
The company has managed to revive its clothing and homes sector, cutting back on discounts, including over Black Friday. It has instead simplified product ranges and reduced prices on more than 2,000 everyday items.
In the 13 weeks to July 2 2016, clothing and homeware was hit by its biggest fall in like-for-like sales since the 2008 banking crisis, with a 8.6% dive, which Rowe attributed to products being too expensive and shoppers’ focus on promotions. Like-for-like sales for clothing and home grew 2.3% in 13 weeks to December 31 2016.
The company first established a presence in Paddington in 2005, and currently occupies three buildings there: 5 Merchant Square, Waterside House at 35 North Wharf Road, W2, and 10 Eastbourne Terrace, W2 – where it houses its digital team.
It also has a small office at Baker Street, where it had its former headquarters, as well as in Chester and Salford Quays in Manchester.
M&S declined to comment.
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