CBPE

Moving on from 16 years in The City

CBPE had occupied the same space in one of The City’s towers for the last 16 years. An office move would provide an opportunity to upgrade the quality of their working environment. Allied with a focus towards the West End, this could position them closer to their industry peers, and also bring an exciting refresh for the team.

The Challenge

The business wanted this move to be a statement, requesting only best-in-class buildings, with the highest sustainability credentials, and generous occupier amenities; with a budget to allow for this the project should have been relatively straight-forward. However, the management team required a 5th year break clause option – something that is extremely hard to achieve in London’s prime real estate over a certain size, where 10 year terms are the minimum.

Our Approach

The primary areas of focus were Marylebone and Fitzrovia, with The City remaining a good fall-back option. We set about uncovering every on-market and off-market opportunity available, entering negotiations on multiple options. Yet, in all instances the 5th year break option was rebuffed. We had to approach this differently; widening the search area would help, but the solution came from understanding the Landlord’s position.

The Challenge

What had become apparent through our search was that we were focusing on buildings of a modest size where we were taking a meaningful proportion of the total space. When considering the Landlord’s perspective, this would mean our 5th year break would have a disproportionately negative bearing on the overall WAULT, thus affecting the investment grade of the asset. With this in mind, our strategy switched to focusing on larger developments in which our 5th year break could be more easily absorbed in an investment analysis.

Outcome

We identified a building in Covent Garden that could become an option, but all of the available space was significantly larger. Before presenting it to our client we engaged with the Landlord’s team to establish whether a) our required space could be created by splitting one of the larger floors, and b) if so, whether we could discuss the 5th year break option as part of the consideration. The responses were positive, and so after a few weeks of negotiations we managed to secure a truly outstanding space, with a large private roof terrace, overlooking Covent Garden, at the size we needed and with the break option that was so necessary.