Happy is moving. A month ago, just before the deadline for the landlord’s break clause approached, a law clerk arrived at our office and served a notice to quit. The landlord plans to redevelop the building and we have to be out of our office by 30th October.
This has led to great excitement here. It is an opportunity for all kinds of changes and everybody has been thinking about what the new Happy will look like. We’ve signed up to an agent and have started talking to Design & Build companies, with a remit for the new offices of “quirky but professional, more Google than HSBC”.
But our search for a new office has come as something of a shock. We are currently paying £15 a sq ft (on an agreement made less than 5 years ago) and we knew we’d have to pay more. The latest research from agents Michael Pain, dated October 2013, suggests a price of £22 a sq ft (with 18 months rent free) in the Aldgate area. Well, prices seem to have gone up a lot in six months. We haven’t seen anything under £29 a sq ft and precious little anywhere near that.
Indeed we haven’t yet managed to find any landlord willing to make a proposal. We are looking for 5,000 sq ft of space and are happy to sign a 10 year lease. At £30 a sq ft that would mean signing a contract for well over a million pounds. We even have the £100,000 deposit that will be required. But nobody seems interested.
Is the state of the London property market good for a vibrant economy?
Perhaps there is a dire shortage of central London property. Or perhaps I should be expecting to pay three or four times what we agreed to back in 2009. I had naively thought there might be good availability. A lot of space is unlet in the Shard and both the Walkie Talkie and the Cheese Grater come onto the market in the summer. While those can be expected to be pricey, there should be a lot of property that companies are moving out of, to move into those.
On the other hand a lot of buildings are being converted to residential space. We are told the two bedroom flats above Aldgate East station have sold out, at £1 million each. (Apparently a third of them were sold in a single weekend when the developer pitched them in Hong Kong.)
The Old Street, Silicon Roundabout, area would have been very affordable back in 2009 but now rents seem to have gone through the roof there. Is this good for an entrepreneurial economy? Or is central London to become an area just for big business, with the smaller businesses pushed out to the periphery?
All ideas and suggestions welcome. Do let me know if you know of any great spaces in the central London area.
Must go, ever hopeful, got offices to see……