The commercial property market that serves London’s South Bank had an exceptional 2016 which was characterised by Apple’s decision to base its HQ at Battersea Power Station.
Findings from our Q4 16 analysis show the take-up of office space last year was 40% up on the long-term average annual level.
Whilst the Apple letting contributed to this, if the tech giant’s deal is discounted, then the final quarter was still the strongest of the year.
Leasing & Development Partner, Simon Smith, commented: “The Apple deal guaranteed it was going to be a watershed year for the South Bank but the market wasn’t just about one deal. The final quarter showed the highest level of take-up throughout the year. In many respects, 2016 was a rollercoaster, but we have finished on a massive high”.
In the latest Estates Gazette London Office Market Analysis, we were named the leading office agent in the South Bank market in 2016, having advised on more than 280,000 sq ft of lettings!
The investment market in the first half of the year reflected both the lack of liquidity in the market and some hesitation to make decisions, ahead of the referendum. The year, finished more encouragingly with Q4 volumes up 13% on the previous quarter, however the closing total of £487m, was significantly below the eight year annual average of £763m.
Investment Partner, Alastair Hilton, commented: “The South Bank investment market is very much ‘steady as she goes’. There is a broad capital base and investor appetite remains strong with buyers who are seemingly not deterred by world events. There will, however, be a widening gap between vendor and purchaser aspirations, driven in part by their interpretation of current macro level events. There is more sizeable investment stock currently in the market, and this will be a good barometer for the year ahead.”
A wide range of retail and leisure developments including those at Vinopolis, Leake Street and Waterloo International Terminal are bringing a new diversity of shops, restaurants and bars to the South Bank. The restaurant sector has been particularly active and has seen high-profile openings by Hix, Hawksmoor, Lobos, Caravan and Union Street Café.
Simon Smith comments: “The South Bank has always had a strong cultural identity primarily because of its theatres and galleries, but we are now seeing a growing enrichment of the food, drink and leisure amenities into the hinterland beyond the riverside.
“Business is being attracted to the South Bank not just because of the high quality of workspace available but also by the increasing vibrancy of the location.”BACK TO NEWS