Derwent lettings surge as Brunel demand continues
Derwent has recorded a surge in lettings following strong interest in its Brunel Building in Paddington, W2.
US luxury retailer Coach and Alpha FX are the latest tenants to lease space at the firm’s 243,000 sq ft office building.
The pair have leased around 30,000 sq ft between them. They join Hellman & Friedman (20,500 sq ft); the Premier League (33,000 sq ft); and anchor tenant Sony (77,000 sq ft).
Derwent has recorded a surge in lettings following strong interest in its Brunel Building in Paddington, W2.
US luxury retailer Coach and Alpha FX are the latest tenants to lease space at the firm’s 243,000 sq ft office building.
The pair have leased around 30,000 sq ft between them. They join Hellman & Friedman (20,500 sq ft); the Premier League (33,000 sq ft); and anchor tenant Sony (77,000 sq ft).
The slew of deals mean the building is now nearly 70% let.
In its Q3 trading update, Derwent said its total lettings for the year-to-date covered 357,700 sq ft and brought in £23m – almost double the £11.8m announced in August 2018.
Chief executive John Burns said: “The lettings side has done really well, particularly at the Brunel Building. We are not going to complete the building until next year, but demand is very strong.”
He added: “Second-half lettings have already substantially exceeded those in the first half. We have now successfully de-risked both of our on-site developments and lowered our vacancy rate, placing us in an excellent position to progress our next two major developments.”
It has also seen its net debt increase by £70.9m to £892.4m in Q3. The company said expenses related to acquisitions, including the purchase of 88-94 Tottenham Court Road, W1, in September for £41.9m, and capital expenditure on projects of £50.6m.
It recorded a gain of £13.4m from the Porters North, N1, joint venture following the sale of the property earlier in the year.
Developments at the Brunel Building and 80 Charlotte Street, W1 are on track for delivery in H1 2019 and H1 2020, respectively. Preliminary work has begun at Soho Place, W1.
Derwent has also exercised breaks on the leases at Monmouth House and 19-23 Featherstone Street, EC1, with the buildings set to become vacant at the end of December. Both projects are set to begin construction in H1 2019, with completion expected in 2022.
Property values for Derwent’s central London offices “remain firm”, according to the results, “bolstered by good levels of activity”.
Derwent owns 87 buildings in a commercial real estate portfolio valued at £5bn, making it the largest London-focused REIT.
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