10.27.09

Now the square mile may face an office shortage

Posted in Ads, Business Performance, Life + Real Estate at 11:20 am

Macquarie has signed up to occupy one of the largest buildings in the Drapers Garden scheme in the City of London, near the Bank of England, raising concerns for the first time that there may actually be a shortage of office space in the Square Mile.

The finance group from Australia will move into approximately 220,000 sq ft of offices soon, although they will not owe any rent for over four years, as part of competitive deals to encourage letters into the area. Once the four year period is over, the group will pay £43 sq ft for the remainder of the 20 year lease agreement.

Currently Macquarie has been experiencing a great deal of growth throughout Europe and remains the dominant investment bank in Australia. Due to the fact that it has not had to look to the government for aid during the economic fallout, insiders believe that it will remain profitable for years to come.

The recent shortage of Grade A buildings comes as a result of the new Macquarie deal and of the recent lettings to Nomura, Mitsubishi, and the Bank of Tokyo.

Occupiers on the lookout for new developments for office space include BlackRock and Bloomberg, although BlackRock already has their eyes on the new Walbrock scheme in Canary Wharf.

A great deal of the desk space shortage may be addressed by the two tier market office space as second hand office space is becoming more popular as rental growth continues to increase.

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