The Docklands and Canary Wharf areas are no longer exclusively a centre of commerce and business; you can now while away many an hour browsing in the fashionable shops and eating in the trendy restaurants and cafes located directly under One Canada Square itself. Those in need of a glass of wine after work, or looking to extend the evening until the early hours on a Friday night, flock to the docks area where well known bars play host to many great evenings. And, for those wishing to burn some energy, there’s a multitude of options in the area, including running, cycling, gyms and football courts. At the nearby world-famous O2 arena, there is always a great concert to listen to; it boasts a portfolio of big name concerts from the last few months alone, including Madonna, Elton John, and Take That. As you can see, Canary Wharf and Docklands offer much, much more than just a business location; they offer a whole lifestyle that’s unmatched by any other area of the UK.
Canary Wharf (London’s E14 postcode) was developed as an area to relieve the strain of commercial space in central London. What was once a hub of markets and traders is now a hub of property firms and investment banks, to name just a few of the sectors presented in this dynamic and high-growth area. Big players in the financial market, such as HSBC, Barclays and Citigroup, form the fabric of E14, but in fact the area plays host to companies of all sizes and sectors, from a one-man trader, to a 50-person communication company, and a 400-strong multinational recruitment firm. Clearly, there is something for everyone in this exciting and mushrooming area!
The Canary Wharf serviced offices market is still a very competitive one with numerous, well-established operators basing themselves in the vicinity, in a bid to capture the high workstation rates demanded by the area. Businesses can expect to pay in excess of £1,000 per serviced office workstation for a Grade A centre in the heart of Canary Wharf, whilst if you move into the wider peripheries of The Docklands, those costs plummet to as little as £500 per workstation.
As for the Docklands Serviced Office market, there has never been a better time to take up serviced office space, with two new business centres now establishing themselves in the area. One of these is in the heart of Docklands, on the 37th floor of Canary Wharf, offering ‘above and beyond’ a premium serviced office for 400 clients. If you venture into the Docks’ Pepper Street, a modern serviced office solution can be found that houses up to 150 customers at any one time. Clients looking to take office space in Canary Wharf and the Docklands should move quickly, as demand suggests these centres will fill quickly and prices will increase significantly thereafter….
According to GVA Grimley, immediately available serviced office space in the Docklands has decreased to 3.2% of total stock (equating to 618,790 sq. ft.), representing a 3.5% drop as compared to the previous quarter, due to the large amount of office space being placed under offer during this period (August, 2008). In terms of the future supply of new stock, Arrowhead Quay (526,000 sq. ft.) has been built to grade and is currently awaiting a pre-let. Canary Wharf Group is preparing Riverside South (1.8 million sq. ft.) for a pre-let, and 20 Churchill Place (363,000 sq. ft.) is scheduled to complete next quarter although this is pre-let in its entirety to State Street Bank.
The serviced office market is still characterised by a lack of space officially available and there is little prospect of any speculative development. However, demand has tailed off in the 5-10,000 sq. ft. range. There are many active requirements in the Canary Wharf area at this moment as more and more companies look to break from the expensive Square Mile.
As regards conventional rents, prime rents have remained at £47.50 per square foot in Canary Wharf. However, rent-free periods have been extended out to 21 months on a 10 year term, compared to six months in the corresponding quarter last year. In the wider Docklands area, prime rents have stabilised at £32.50 per square foot, with rent-free periods at 24 months. This delivers the clear message that there are still large conventional deals in the area – with numerous landlords offering strong incentives for clients to take on larger space in Canary Wharf.