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Mooney, head of commercial agency at Carter Jonas in Cambridge, explains: “We know there are some strong requirements out there, ranging from 80,000 sq ft down to several in the 20,000- 30,000 sq ft zone. Perhaps 250,000 sq ft of real hard core demand and another 250,000 sq ft, which is in earlier stages. In these circumstances, presales and prelets are going to be required.” In a landlords’ market rents are bound
to rise, and in the core Hill Street/Station area agents are already quoting above £30 per sq ft. “I wouldn’t be surprised to see £32 or £33 a sq ft confirmed,” says Mooney.
Rumour has it that £34 per sq ft is
already being quoted, and fingers point to Freshwater/Endurance Estates 9,030 sq ft at 90 Hills Road. Letting agent Savills confirms that this is the quoting rent. Some observers are wide-eyed with wonder. “That would be rather a lot for a refurbishment, even given that it’s a fantastic building on a good spot,” says Philip Woolner at Cheffins Commercial. Even so, it may be a sign of what is to come.
If anything stands a strong chance of
making £34 per sq ft stick it would be Brookgate’s CB1 development. Last summer, Brookgate agreed a 40,000 sq ft prelet at 22 Station Road to Mott Macdonald at a rumoured £32 per sq ft. Chris Reeve, head of office agency at
Bidwells Cambridge and joint agent with Jones Lang LaSalle, says they are already talking seriously to potential occupiers of the remaining 21,500 sq ft at 22 Station Road. “We are in discussions for prelet
agreements at rental levels exceeding £30 per sq ft,” he says. “And if we could get £30 per sq ft plus
on prelets, I wonder how much we could get on speculative development, which is always a little higher once tenants can
touch and feel the building.” So if everything looks so hot, why are the big Cambridge developers hesitating before they launch speculative developments? There is some talk that Development
Securities might look to speculatively build at least some of its scheme at Cambridge Science Park (see extended iPad edition). “It’s maddening,” says Reeve. “We
have occupiers looking for new space, and more lease events coming up in 2014-16, which will mean more requirements. It’s like we can see the planes are circling overhead, but there’s nowhere for them to land. If ever there was a time to risk development outside the real hot spots of London and Aberdeen, it has to be now in Cambridge.” The answer may be that developers do
not have much incentive to take a risk if the prelets keep on coming. This spring and summer, as
development appraisals get prepared, checked and re-checked, Cambridge will find out whether its developers are risk-takers or not.
LONDON PAVES THE WAY FOR CAMBRIDGE DEVELOPMENTS
Johnnie Vincent is one of the most dynamic presences in the sometimes sleepy Cambridge property scene. He first came to know the city working as a junior surveyor in Bury St Edmunds. Twenty years later his portfolio is
growing fast. The acquisition of the 10,000 sq ft office at 37 Hills Road is just the latest buy. These days, Vincent is more interested
in another road – the road from Cambridge to London. This, he says, will provide the dynamic for the next few years of property development. “Look down at King’s Cross, where we have the new Google HQ, and so much
tech development around the Old Street roundabout, all of which links well with Microsoft’s HQ in Cambridge, and the city’s huge biomedical and technical sectors. What is happening in London is just 45 minutes from the clever people and exciting industries of Cambridge,” he insists. “My focus is on Cambridge. I expect a speculative start on the Botanic House redevelopment looked bold 18 months ago, but we are trying to produce West End-quality buildings in a city where the secondhand office stock is often mediocre and where demand for good quality offices is high.”
23 February 2013 A WALK IN THE PARK?
Development Securities are said to be close to pre-letting two of three new buildings in the sixth phase of Cambridge Science Park. It is beginning to seem possible – though not necessarily likely – that they will speculatively build the third unit. They have applied for outline
permission for 133,000 sq ft of new office space on behalf of land owner, Trinity Hall. The buildings will provide 40,000 sq ft, 45,000 sq ft and 48,000 sq ft. Work on site could begin this year
with Savills and Carter Jonas as letting agent. Executive director Julian Barwick says “I guess anything is possible, but the likelihood in Cambridge is that we will prelet. Cambridge is the kind of place where you always build with one or two occupiers in mind.” “We are very enthusiastic about more
activity in Cambridge and open to suggestions. I’m particularly keen to see us get under way on the 45,000 sq ft for which we have planning permission at Camborne business park.“ Development Securities are not alone in their ambitions. Last year, US giant Biomed Realty paid around £125m for the 120-acre Granta Park site. Its first investment in the UK, it matters that it should be a success. The two front plots suitable for buildings of 47,000 sq ft and 38,000 sq ft are now being marketed for prelets. Cushman & Wakefield is advising. There are some big fish ready for Biomed and DevSec to catch, including 80,000 sq ft from Cambridge Silicon Radio. Today CSR have offices at the Cambridge Business park and the St john’s Innovation Park. CSR declined to talk to EG but it is understood leases expire in 2014. “It’sjust feasibility at this stage,” said Cushman & Wakefield, which is advising.
www.estatesgazette.com 79
Francis House: Mills & Reeve’s former home is next on Vincent’s list of speculative refurbishments
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