Construction Opportunities Surge with London Office Towers
Glenigan reports that developers are bringing forward a wave of high-rise office schemes in the City of London in response to strong demand and premium rents for energy-efficient Grade A space, creating significant opportunities for contractors.
City planners recently approved a 74-storey tower at 1 Undershaft, which would match the height of the Shard. AXA IM has also submitted plans for a tower at 63 St Mary Axe with a public park at its base.
Glenigan data shows major project contract awards in London were worth £1.99bn in the quarter to January, 6% higher than a year earlier, while major detailed planning approvals reached £3.54bn, up 32% on the previous quarter.
Occupier demand for large, high-quality space remains strong. Cushman & Wakefield has reported more requirements of 250,000 sq ft or more, strong Grade A take-up and some of the fastest rental growth on record, including a record 17 City leases signed above £100 per sq ft last year. It puts the central London office pipeline at 15.18 million sq ft, around two-thirds due in 2025.
Major City schemes highlighted by Glenigan include:
• Evergo Tower, 120 Fleet Street: a £429 million, 20-storey scheme with Lendlease as construction manager, due to start this summer • The Dovetail Building, Cutlers Exchange, Houndsditch: a £400 million, 23-storey scheme, also led by Lendlease, with a 51-month programme • 99 Bishopsgate: a £477 million, 53-storey tower for Brookfield Developments Europe, approved in January, with Multiplex advising and work due to start next autumn • Camomile Park, St Mary Axe: AXA's proposed £500 million, 40-storey building with public green space, which could start next autumn • 50 Fenchurch Street: a £400 million, 36-storey tower for AXA, under way with Multiplex and due to run until 2027
