Sector: London Offices | Contact: Patrick Ryan
With corporate occupiers expected to increasingly target a “one-stop commute” for employees (see our latest London Markets report for further information, new dynamics are coming into play. A market such as Victoria – adjacent to a major transport hub, and within easy walking and cycling distance of others – will become increasingly attractive to firms keen to have staff back at their desks while addressing any welfare and wellbeing concerns they may have.
The proximity to a major rail terminus sits alongside the area’s other advantages. Victoria is blessed with proportionately better-quality office stock than most other business districts, a position that has been cemented by the regeneration of Victoria Street over the past decade. There are an abundance of well-specified buildings that incorporate features particularly suited to social distancing measures, such as larger passenger lifts and large receptions.
There are also early signs that corporate occupiers may look to create larger satellite offices which are directly commutable into mainline stations like Victoria, with the ripple-out effect likely to benefit the area as a central office headquarters hotspot. The decision by Amex to remain at Belgrave House on Buckingham Palace Road highlighted the clear benefit of having a direct link to its Brighton HQ. And with Victoria offering direct train links to major commercial centres locations across Kent, Sussex and beyond – including Southampton, Portsmouth, Brighton, Crawley, Haywards Heath, Ashford and Maidstone – the station’s catchment area is highly significant.
Despite the positive position Victoria holds within the wider London office market, the last six months has seen a predictable increase in availability in the area, rising from 3.5% to 5%, but still below the ten-year average of 6%. Most noticeably, ‘tenant space’ – existing occupiers subletting unneeded floorspace – now accounts for nearly a quarter of availability. This figure is expected to increase in the coming months as occupiers reassess their real estate strategies.
Given the opportunities available, it is crucial that occupiers seek quality advice and adopt flexible real estate strategies as the market becomes increasingly crowded. We have a strong leasing track record across Victoria, and are well-placed to advise on mitigating lease liabilities. The Victoria market is presenting significant opportunities, but the time to strike is now.