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Shoreditch is currently experiencing a ‘media boom’ in terms of office space. Traditionally Soho has been the hub for media firms starting out in the business but as rents continue to rise in Soho, and the effects of the recession still hang over many businesses, especially start-up companies, the latter in particular are looking to tighten their purse strings and cut costs at every opportunity. One way of doing this is through property costs, leading to more and more media firms relocating east to offices in Shoreditch, where traditionally rents have been much lower.
This influx of tenants into this newly desirable area has had a dramatic effect on its rents and the area’s property market as a whole. Two years ago average rents were around £20 per square foot yet landlords still struggled to lure media firms away from the bright lights of Soho and Belgravia; just two years later and media sector companies are now vying for Shoreditch’s typical and popular space. Tom Lax, a senior agent from Morgan Pryce, believes the demand for office space in Shoreditch is so high due to the fact that so many businesses “are aiming for a warehouse feel, the New York-style loft space – exposed brickwork and wooden flooring – which can be found in the Shoreditch vicinity due to its history .”
One of the reasons why rents are increasing in Shoreditch (landlords are seeing rents achieve £42.50 per square foot) is that regardless of the increase, they are likely to always be lower than the Soho rents. Therefore, for tenants who are looking to make savings, a move from Soho to Shoreditch will almost always result in paying less rent. One of the reasons for this is business rates. Business rates in Soho average around £18 per square foot whereas rates average around £9/10 per square foot in Shoreditch.
Morgan Pryce is 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.