Welcome to the Q4 update of 2023, with an up-to-date view of the commercial property market in West London Featured in this issue: Market Summary, Take-Up, Q4 Headlines, The Changing Face of West London and Office News

L’Oreal is the latest company to crack down on remote working.
Read more in the Overview…

Kendall Jenner, L’Oréal’s Global Ambassador (pictured in header)

Q4 Market Update- Office News – 2023 Review Edition
Simon Kibble & Sue Bunn  February 2024

 

OVERVIEW

Q4 saw a flurry of deals being completed leading up to Christmas. This is not unusual but interestingly the increase in enquiries we reported in Q3 converted into deals and the individual deal size was up on previous quarters.  In recent years the trend has been for smaller fitted offices, on shorter and more flexible terms.

One of the factors feeding into the market confidence is that businesses are demanding more consistent office attendance.  L’Oréal is the latest company cracking down on remote working, by tightening rules on staff attendance, mandating that staff attend the office on at least two Fridays in every month.

In Q4 the French beauty giant relocated to a purpose-built HQ at White City Place, from 255 Hammersmith Road, Hammersmith.

The Bank of England is cautiously open to the possibility of interest rate cuts. Inflation has fallen back relatively sharply over the past few months but the Bank of England gave no timetable for cuts. Central bank has kept interest rates at 5.25%. There is hope that the markets are stabilising and we have reasons to be optimistic for 2024.  

FULHAM

In Fulham The London Oratory School took 8,257 sq ft at 2-6 Fulham Broadway for £46.50 per sq ft. At 10 Peterborough Mews near Parsons Green, Tex International a textile company signed a 3 year lease for 2,610 sq ft at £38.31 per sq ft.

CHISWICK

Federated Hermes sold Chiswick Tower, a landmark building located at 389 Chiswick High Road. The 156,000 sq ft office building was purchased by a private buyer for an undisclosed sum. More details in Q4 Headlines…

NOTTING HILL & WHITE CITY

In Notting Hill The Ruddock Foundation for the Arts purchased 99c Talbot Road totalling 5,689 sq ft for £4.2 million.

In White City Vue Entertainment completed on One Ariel Way, 3rd floor 13,638 sq ft for £55 per sq ft for a term of 10 years from Unibail-Rodamco-Westfield. The Lloyd Williamsons Schools Foundation completed on 5,540 sq ft at Park House, 206-208 Latimer Road for £32.50 per sq ft for 10 years. Club North Ltd a gymnastics school for toddlers to teenagers signed at 343 Latimer Road, for 1,890 sq ft at £30.95 per sq ft for a 10-year term.

KENSINGTON & CHELSEA

In Kensington the Arora Group completed on the 142,353 sq ft purchase of the former Heythrop College. Read more in Headlines…

At the new One Olympia, Olympia London a deal was completed in December 2023 for the entire 5th floor of 73,152 sq ft, with a stunning roof terrace overlooking west London to a serviced office provider. At The Universal Building​​​​​​​, a brokerage firm Addison Bradley & Co, completed on 1,804 sq ft for 5 years at £32 per sq ft.

 In Chelsea, we sold a small office building of 1,401 sq ft at 91a Drayton Gardens for £2 million (£1,425 per sq ft) to an owner-occupier. At Chelsea Wharf we secured a steady stream of lettings for our clients Bedford Estates the latest being Interior design company O & A London agreed on 1,267 sq ft at £35 per sq ft for  5 years.

HAMMERSMITH

In Hammersmith CloserStill Media Global Ltd took 23,427 sq ft 3rd floor at The Foundry signing up for 10 years at £49.50 per sq ft.  A private property company purchased 7, King St Cloisters totaling 2,979 sq ft for £1.3 (£436 per sq ft) million from an undisclosed seller. Happy Kids Dental completed at Colet Court at a rent of £26 per sq ft on 4,114 sq ft for 15 years.

Up the road at Lyric House model agency Body London, founded by ex-model Gemma Howorth signed 3,412 sq ft for a rent of £30 per sq ft, on 3 year term. The Clockwork Building is welcoming a new tenant THIS, the meat-free, meat alternative company that produces products such as ‘THIS isn’t Chicken’ taking 7,484 sq ft for 3 years. 

 

The Arora Group completed on the acquisition of the former Heythrop College 2.7 acre site, Kensington Square. The site value is £750 million with approx. 142,353 sq ft of buildings.

Arora is one of the UK’s largest private owner-operators of hotels, including Fairmont Windsor Park, InterContinental London and Sofitel London Heathrow.

Sanjay Arora, Chief Operating Officer at Arora said: “The acquisition of this extremely rare site in Kensington is in line with our ambition to acquire an asset with significant development potential in Prime Central London.”

 

In Q1 Federated Hermes put a £195 million investment portfolio of 3 properties totalling 500,000 sq ft of office space on the market. Chiswick Tower, located at 389 Chiswick High Road and totalling 156,000 sq ft office space, was purchased by a private buyer in Q4 (December) for an undisclosed sum.

Built-in 1966 as the IBM UK headquarters, latterly occupied by the British Standards Institution and bought by Hermes in March 2013 for £56.5million.
We understand that the other 2 buildings in the portfolio, 26 – 28 Hammersmith Grove W6 and Wimbledon Bridge House SW20 have now been withdrawn from the market.

 

Squire & Partner’s plans, reported in our Q2 Market Update, have just been approved to refurbish and extend the 1950’s Newcombe House 12 storey building by 3 floors and introduce two new neighbouring buildings on Kensington Church Street, replacing previous contentious plans to demolish the tower, which was approved four years ago. The site sits opposite Frogmore’s Astley House where final plans are being made by Squire’s for a new office scheme of 35,000 sq ft to be delivered in 2025. Frost Meadowcroft is instructed and seeking pre-let interest on the latter.

Recent Sales History: March 2022 Angelo Gordon & Beltane purchased 45 Notting Hill Gate site known as Newcombe House. In November 2023 TPG acquired Angelo Gordon as part of a large portfolio, including 45 Notting Hill Gate.

The Earls Court Development Company (ECDC) has revised their master plan, which shows a 20% increase in open space and a 10% reduction in development compared with February’s plans.
Delancy & Transport of London who purchased the site from CapCo in 2019, are expected to submit a hybrid planning application in mid-2024. The first phase is due to start in 2026 which will include vital east west transport connections.

At One Olympia, the office element of Olympia London completed its first pre-let of 73,152 sq ft to an undisclosed serviced office provider.
The scheme is expected to be completed later this year and boasts a host of cultural facilities including;

• A new theatre, a 4,000-capacity music venue
• Jazz-style Restaurant 
• A school of performing arts 
• 100,000 sq ft of bars, cafés and restaurants
• 2.5 acres of public space

The new Civic Campus is due to open in 2024. It will truly change the look and feel of Hammersmith’s King Street providing new arts, cultural, business, government, and community quarter. Opening up a public open space around Hammersmith’s revitalised Grade II-listed art deco Town Hall.

The scheme includes:

• Affordable homes – over 50%  for local residents
• Cinema & Arts – 5 Screen cinema, performance venue, gallery & public art program
• Public Piazza – with gardens, stage area,  café dining and public space
• Panoramic Roof Gardens – for residents
• Start-ups Office Space – Over 6,000 sq m

West London’s most iconic office building has been reinvented and totally refurbished. Hammersmith’s ARK totalling 135,000 sq ft of remarkable office space has breathed life back into a building that was truly ahead of its time. Showcasing cutting-edge architecture, Frost Meadowcroft is now marketing the unique workspace on behalf of Alduwaliya, offering offices from 7,000 sq ft :

• 9,000 sq ft of roof terraces
• Amenity lounge 
• 7,500 sq ft reception
• café & gym  

ALOS…