Many institutional investors previously liked to have traditional office, shop or warehouse occupiers as their tenants. Many were wary of leisure uses such as cinemas, bowling alleys, gyms etc. A report this week in Estates Gazette discusses the arrival of both high end and budget operators into the gym sector. This sector has proved a welcomed occupier of first floor space in town centres where previously the office also storage space has had limited attraction. The stand alone, purpose built gyms have proved popular for investors where the operator frequently takes long term 20 and 25 unexpired leases. In addition to the well known traditional brands it is estimated that there are around 20 budget operators including Fit Space, Gym4All and The Gym Group looking for sites in the UK.
Many of these alternative upper floor uses can compete with office occupiers on a rental basis and indeed Mellersh & Harding have recently acted on the letting of an office on the King’s Road, Chelsea, London SW3, to a pilates studio. This being accommodation which has always traditionally being occupied as offices. Mellersh & Harding have also acted on the letting of 10,000 sq ft of traditional offices to a private members health, well-being and lifestyle club in West Halkin Street, Belgravia, London SW1.
David Mundy, Investment Partner at Mellersh & Harding comments "Many investors like the idea of mixed-use buildings, particularly where alternative uses can provide comparable or even better lease lengths and quality of income".
Further details of Central London offices to let can be found on our website or from Jonathan Stern 020 7522 8517.