Despite the year starting in the depths of lockdown, London’s office leasing market proved remarkably resilient over the course of 2021. Tech giants have signalled their belief in the UK capital with a clutch of high-profile, big-ticket leases, while corporates have started making decisions about what their future workplace footprints will look like – and have struck the deals to prove it.
As 2021 draws to a close, EG looks back at a unique 12 months for the UK capital, with a highlights reel of the most significant workplace commitments made over the year.
Facebook and the tech giants
Facebook’s decision to expand its presence in London significantly was emblematic of a broader view among the Silicon Valley giants that the UK capital remains a key global hub for attracting the best talent.
The social media behemoth was revealed to be taking 310,000 sq ft at 1 Triton Square, NW1, part of British Land’s Regent’s Place campus, in September. The deal came as a boon to leasing agents across the city.
That office will accommodate thousands more workers as Facebook looks to roll out a variety of new products over the coming years, including its recently revealed virtual reality concept, the Metaverse.
Meanwhile, two of its main competitors for global smartphone users’ collective attention span signed major office deals in the City fringe.
TikTok completed a deal to lease the entire 88,500 sq ft of Helical’s Kaleidoscope building (main picture) in March, having entered talks to do so in the third quarter of 2020. And months later, Snapchat was revealed to be taking 114,000 sq ft just down the road from its Chinese rival, at HB Reavis’s upcoming office scheme, Bloom.
Lawyered up
The City of London leasing market was driven in part by several ongoing requirements in the legal sector.
In January, Latham & Watkins confirmed that it will move out of its current premises at 99 Bishopsgate, EC2, in 2026, taking 200,000 sq ft of space at the upcoming 1 Leadenhall.
Last month, Magic Circle firm Allen & Overy completed a deal to move into British Land’s upcoming building at 1 and 2 Broadgate, a prelet for 2027.
Sandwiched between them were deals such as Kirkland & Ellis taking a prelet at the upcoming 40 Leadenhall Street, known as Gotham City, and Travers Smith signing for 250,000 sq ft at Ivanhoé Cambridge and Co-Re’s upcoming Stonecutter Court development.
Savills’ City analyst, Will Wilson, said the flurry of deals would “provide increased confidence to other occupiers with potential requirements”.
“The commitment of large companies to sign lengthy lease terms stimulates the market, providing an air of longevity for years to come,” he added.
Filling up 22 Bishopsgate
The City’s tallest office tower was a hive of activity through 2021, as occupiers looked to top quality offices in the sky in a bid to lure workers back to their desks.
Wall Street legal giant Skadden, Arps, Slate, Meagher & Flom, UK insurer Fidelis and the Korean Development Bank joined existing tenants including Hiscox, law firms Cooley and Covington & Burley, and owner-occupier Axa IM Alts at the 278-metre tower.
Those three deals took up more than 120,000 sq ft of office space at the skyscraper, while US investment bank William Blair was revealed to be under offer on a further 66,000 sq ft last month.
However, perhaps the most significant deal of the year at the site was Apple’s decision to take another 78,000 sq ft, marking 22 Bishopsgate as the company’s second London base alongside its upcoming office at Battersea Power Station.
The world’s first trillion-dollar company already occupied 52,000 sq ft across floors 31 and 32, but in the third quarter elected to take three additional floors above, which had been reserved as option space throughout the pandemic.
Apple’s expansion rounds off another turbulent year for the capital’s office market – but has shown occupiers that where top-quality offices are concerned, at least, there is life in London yet.
Discover which agents have transacted the most space in London so far this year >>
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