Australian bank and investment group Macquarie has decided against a major relocation in the City of London or Canary Wharf, opting to keep its European headquarters at 25 Ropemaker Place in the City, CoStar News can reveal.
The group, advised by CBRE, had been reviewing locations able to accommodate an up to 250,000-square-foot requirement for ahead of its lease expiring in 2030.
Among the shortlisted buildings, in a notably supply-starved central London office market, were Edge Liverpool Street, 75 London Wall and the Broadgate campus in Liverpool Street, as well as Canary Wharf.
Macquarie moved into 25 Ropemaker Street in 2010 and has more than 2,000 staff there across 220,000 square feet.
The decision will be good news for Singaporean investor landlord Ho Bee Land but a blow for the relatively few new City office developments recently completed or under construction. Take-up and rents do, however, continue to perform strongly for these buildings.
Major financial institutions are looking at their options for moves earlier and earlier ahead of lease breaks and expiries and expiries, with major requirements at present including for Jane Street Capital, advised by CBRE, with a circa 400,000-square-foot search, and PwC, advised by Cushman & Wakefield, searching for 300,000 square feet.
There has been a trend in the last year for some major office requirements to end up with the occupier staying put on short-term leases as they continue to weigh longer-term options. Examples have included Bank of America, Accenture, EY, Gallaghers, Mishcon de Reya and Nomura.
Mark Stansfield, CoStar's senior director of market analytics, said: "Given soaring fit-out costs, rising prime rents and a growing shortage of high-quality space options at the larger end, more firms will likely follow Macquarie’s lead and opt to stay put and renew leases rather than move, especially if already in a decent building in a strong location. Market participants note that fit-out costs have more than doubled in recent years, which allied to economic uncertainty create a powerful incentive to stick rather than twist."
