Rents rise in high-rise

Signs of positivity in the economy can be diverse and can arise from many different sources. One of these indications is the recent rent increase at the Cheesegrater building, half-owned by British Land. The company, which owns a variety of commercial properties across the capital, has secured a lease to Servcorp with a rent of £72.50 per square-foot. The Australian company, which deals in serviced offices, has agreed to take 12,000 square feet of space on the 30th floor of the Skyscraper. 

British Land will be pleased with the rent, as will other investors and landlords, if the price is an indication that rents are heading in the right direction in the city. 

The uplifted rent is also indicative of rents across British Land’s office portfolio, which the company reports is achieving rents higher than those that had been estimated – as much as 6.8% higher. 

The challenge for the Cheesegrater building, situated on Leadenhall Street, in terms of achieving tenants is that the floor space is smaller than other similar buildings, partly because of the unique shape of the tower. This means that more tenants are needed, each taking a smaller proportion of space compared with buildings such as the ‘Walkie Talkie’, owned by Land Securities and which has bigger floor plates. 

British Land has reported that it has seen renewed and significant interest in its space in London, both in terms of retail and office space. It has confirmed that its last financial quarter was a positive one, with occupancy rates up and some of its assets sold off, the latter also indicating healthy improvements in the commercial property market. 

This news was brought to you by Morgan Pryce, a specialist tenant acquisition agent with offices in Oxford Circus and the City. Morgan Pryce specialises in search, negotiation and project management and works exclusively for tenants.