3 US Brands Commit To Lease UK Office Space
UNITED KINGDOM – Three major American organisations have committed to lease office space in the country, uplifting the UK’s office market, reported Costar News on Monday evening (10 October, SGT).
In particular, Blackstone intends to fully lease a 10-storey office building in Berkeley Square in Mayfair, London. The world’s biggest alternative asset manager will relocate from the 75,000 sq ft office it currently leases at 40 Berkeley Square.
Spanning 226,000 sq ft, the commercial property located on the site of the former Lansdowne House is targeted for completion by 2028. It will function as Blackstone’s new European headquarters.
Apart from setting new green standards, the office tower will come with 1,800 seats, in addition to 14,000 sq ft of redeveloped public areas and ground-floor retail space.
The commercial property is being developed by Co-re on behalf of the Audley Group, which is owned by the Brunei Investment Authority. The office sale was brokered by Knight Frank.
It wasn’t disclosed what Blackstone will be paying to rent the office component of the £200 million mixed-use project, but based on market talk, the rental rates for prime office space in Berkeley Square are now nearing £200 psf per month, which is a record rent for office space globally.
Blackstone’s announcement comes 1 day after Costar News reported that New York University’s London campus has committed to lease a big office tower on The Strand in London’s Midtown area.
Specifically, NYU London has agreed to lease the 75,000 sq ft 265 Strand from development manager Macallan Brown on behalf of Euro-Group. The office tower will also undergo an extensive upgrade to provide a new facility for the London campus of the prestigious school.
Meanwhile, Goldman Sachs announced in September 2022 that it has signed a deal to lease a 110,000 sq ft office space at One Centenary Way in the centre of West Midlands city in Birmingham.
Based on CoStar data, overall demand for office space across the country rose by 9 percent in Q3 2022. Besides being the first-time that the figure reached 5 million sq ft since Q3 2021, it was the 2nd strongest quarter since the onset of the COVID-19 pandemic, on top of office leasing count hitting the highest in 42 months. However, the latest quarterly figure is still down 10 percent compared to pre-pandemic averages.