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The government recently introduced a change to planning laws so that the conversion of office B1 use to residential C3 no longer requires planning permission. As said by Christina Weguelin, one of the acquisition surveyors at Morgan Pryce, “Since the floodgates have opened to lessen planning laws to allow the conversion of office use to residential use, there have been major redevelopments across all of central London to bring back the once lived in mansions of areas such as Mayfair, Soho and Fitzrovia especially.”
The founder of Mayfair’s estate agent, Wetherell has noted how they have managed to sell over 100 office buildings in Mayfair in the past year, where the buyer’s intentions were to convert the use to residential. This recent change in planning law, coinciding with the ongoing rise in property prices in London has meant that not many buildings have been left for the use as an office, leaving the supply very tight. Not only is per square foot worth so much more for residential space than office but when it comes to the sale of rental of residential premised the Landlord has the ability to charge based on the gross internal area rather than the net internal area.
The trend for big mansion town houses did originate in Mayfair, but it has spread to Soho, Fitzrovia, Marylebone as well as Tyburnia. This has left a major lack of supply around the west end and has seen rents for offices in Mayfair pushed up to £125 per sq ft. Many occupiers are now choosing to locate in other pockets of London as offices become more and more expensive. The western fringe is now more popular and speculative developments are on the increase to support the increasing demand.
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.