Just as we predicted back in the Autumn of 2014, office rents all across the South Bank have risen dramatically, nearing those of the City for the first time. This is due, in no small part, to the flurry of new developments that have popped-up south of the River, from Tower Bridge, westward to Vauxhall, which have made this area a proper office locality in its own right. Private sector development and public sector infrastructure have attracted strong tenant demand and led to strongly rising rents. The historical rent-price gap between the South Bank and City has well and truly disappeared in 2015 going into 2016.
In the last year we have seen office rents increase by 20% in prime South Bank space, compared with 10% in the City core - with the lowest vacancy/availability level since records began. Prime office rents in the City core now headline at £66.50psf, compared to £62.50psf for South Bank. The surge of new iconic developments is set to come through in the rest of the decade and will help to completely transform the district with additional retail and leisure facilities as well as major travel infrastructure, making the South Bank much more of a desirable and fully established destination for businesses looking to relocate out of traditional sub-centers.
South Bank is fast turning into a city in its own right. It has larger office stock than Edinburgh and Leeds, and a list of tenants that other cities would envy (PwC, EY, News UK, IBM and Omnicom to name a few). Thus establishing it as a premier office location.
In recent times, ask-re has made several acquisitions totaling over 50,000sq ft and is in the process of a similar volume of transactions scheduled for Q4 2015/Q1 2016 at London Bridge, Southwark, Blackfriars and Waterloo.
