Global real estate giant Hines is moving ever-closer to completion of another landmark building, this time one it says will move the quality of offices on in London's Soho. A visit to Film House on a recent weekday showed it is changing perceptions of what occupiers can expect and the tenants that could be showing up in the capital's media hub.
Hines, the Houston-based real estate investment, development and property manager, bought Film House, on behalf of its Hines European Value Fund 3, in 2023 for £135 million. The transaction generated plenty of media coverage largely because its previous owner was WeWork's investment arm Ark, which had bought the building with a proposed WeWork office as part of the underwrite.
The building had in fact been sold to Ark with a hotel scheme consent in place. That is not surprising as the 1920s building is on a prominent art deco corner site on the major Soho street, Wardour Street. It is also well-known for its cinematic ties, as it was originally the home of pioneering production company Pathe and houses Universal Pictures and, more recently, Nike’s London headquarters.
What Hines has taken on is a rare opportunity to develop a Soho block into a large office and in doing so test the local occupier appetite for the level of amenity, sustainability and technology features that modern occupiers demand in the City and prime West End. That may seem an obvious proposition, but Soho's occupiers have typically been media companies looking for character and something a little edgier.
Hines's development, which is rapidly nearing completion, proposes 97,000 square feet of offices. The developer describes the opportunity, given the size and canvas over eight floors, as rarely seen in Soho. Its most obvious competition is the string of major new office developments repurposing department stores a few blocks away on Oxford Street and Bond Street, as well as the office developments around the new Elizabeth Line station at Tottenham Court Road, notably Derwent London's Network Building.
A recent example of a major new office building coming forward not too far from the Tottenham Court Road Elizabeth line station is Capital-38 and Morgan Capital's 85,000-square-foot 21 Bloomsbury, which was swiftly prelet to entertainment and sports agency Creative Artists Agency at the end of last year.
Exterior benefits
Hines is clearly confident it can match that standout letting. Critically, the building is 100 metres from the new Elizabeth line, Matthew Waugh of Cushman & Wakefield, joint office leasing agent with RX London, points out, thanks to a "vital cut through" that shaves time off of the walk from the station.
The develoer's plans for the restoration include a hidden internal courtyard and a 5,281-square-foot luxury rooftop club room and rooftop terrace. Part of this is the 800-square-foot Green Room, a nod to the building's film history, which will be operated by Helix as a meeting and entertaining space. A restaurant located at the corner of Film House comprises 3,577 square feet with letting agents for this Shelley Sandzer and Savills.
Hines is clearly using lessons learned at its new office development for its own European headquarters up the road at Grainhouse in Covent Garden.
Greg Hare, asset manager at Hines, says the building reflects the spirit of modern Soho by combining a "rich historic character with a contemporary twist" to draw in occupiers who traditionally wouldn’t have ventured beyond London’s prime office districts. He says the building’s design incorporates natural materials and calming colour palettes, creating a sense of tranquility. This is complemented, he says, by "carefully curated furniture and art pieces that subtly infuse the character of Soho" throughout the space.
One of the building’s unique features is the integration of a dedicated cycle route running the full length of the building, leading to a secondary entrance dubbed "the stage door" opening into a dramatic, double-height space at the rear of the main reception, offering what Hare terms a memorable arrival experience.
Whether you're a cyclist or a runner, Hare says, given the shortcut to the nearby Elizabeth line station, there will be "no second-class citizens" here.
Attracting interest
The restaurant is proving popular with potential occupiers. “We’ve had an impressive array of top-tier operators through the door,” says Hare. “From Michelin-starred establishments to premium fast-casual brands, the level of interest truly reflects the diversity and quality of Soho’s food scene.”
Hare says there are serious conversations going on with a number of occupiers about preletting the offices before before practical completion in the autumn with the amenity a key sales point, including the communal hub on the sixth floor that can be booked for events. Hare says the building's amenities are leaning into its history with the Green Room but also looking to stand out in terms of wellness. "There is a bit of an arms race in terms of amenities these days."
Vital here is the self-service gym, operated by Refit. "Occupiers can come in and plug into the video and do their Peloton class for instance," Hare says.
A recent report from London offices adviser RX London in partnership with Refit has shown that wellness facilities and gyms in particular were proving crucial, and cost-effective, in securing occupiers.
It found that previously overlooked areas, such as basements and storage rooms, are now being reimagined as wellness hubs to make the most use of low-value spaces but also creating a unique selling point for office buildings for potential occupiers.
Henry Sims, co-founder and COO of Refit, an autonomous amenity and gym provider, says at The Carter building in London, the installation of state-of-the-art gym and studio facilities has exceeded expectations. "Our tenant survey revealed that 20% of respondents cancelled external gym memberships, while over 50% reported increased likelihood of regular office attendance due to these new amenities.
Covering costs
“While the capex was covered by the developer, the occupier was happy to cover the running costs via the service charge, creating an outsized return on investment for both parties.”
Helena Pryce and Hannah Buxton at RX London, who co-authored the report, say wellness amenities have moved from being a luxury to a necessity.
In terms of occupiers, Matt Waugh, partner at Cushman & Wakefield, says there is a diversification in the types of businesses looking to establish themselves in Soho.
“It’s no longer just the domain of creative and media firms. We’re positioning Film House to attract a broad spectrum of occupiers, from dynamic media companies to innovative tech firms and forward-thinking finance businesses, all of which are drawn to the energy, culture, and connectivity of the area."
According to Cushman & Wakefield's '"wheel of movers" data for Soho deals from 2022 to 2024 by former submarket and sector, movers from Mayfair & St James's accounted for 33% of the total in-movers during the period. Cushman says this may suggest occupiers are being drawn into Soho by supply shortages and significant rental pressures in Mayfair and St James's. But it also suggests a shift toward a more comparable view of Soho to the traditional core in terms of rents.
By sector, 40% of in-movers were within the banking and finance sector. Cushman says this again could be in response to supply and pricing pressures in the core and the evolution of the Soho submarket in terms of perceptions, particularly in a sector that tends to be very location-specific.
Waugh says expectations have shifted. "Today’s tenants are demanding more and not just in terms of design and sustainability, but in experience, wellbeing, and long-term flexibility. Film House responds to that demand. It’s a building that celebrates the rich character of Soho while delivering a best-in-class, future-proofed workspace with the most amenity-rich offering the area has ever seen. It sets a new benchmark for what an office in Soho can be.”