3 MEN AND A BABY...
CLIENT BRIEFOriginally instructed by ED & F Man Holdings to reduce their business rates liability at the Cotton’s Centre on London’s South Bank, we then proactively assisted them to evaluate…
CLIENT BRIEFOriginally instructed by ED & F Man Holdings to reduce their business rates liability at the Cotton’s Centre on London’s South Bank, we then proactively assisted them to evaluate their corporate real estate strategy.
ED & F Man’s highest priority was the security of long-term occupation at premises suitable for their evolving business model. Their occupation in Cottons Centre was disjointed over multiple floors and leases, with no security of tenure and lease expiries approaching in mid-2016. The client’s big fear was uncertainty, coupled with the lack of control as the client’s leases were subleases, meaning no direct relationship with the building owner. Our client saw this as a threat to the business and instructed us to pursue a re-gear of their leasing profile to address the issues.
OUR PROFESSIONAL APPROACHAfter reviewing the leases with our specialist lawyer, negotiations commenced with both our client’s immediate landlord, the head tenant, and the building owner, with the objective of one new lease giving secure occupation within the Cottons Centre. These negotiations became protracted, due to the complex leasing structure as there was little incentive for the owner to commit to terms early in a rising rental market. It became clear that, in order to wrest control of the deal back to our client, we would have to trigger the relocation option: this led to us inspecting a number of alternative properties that were viable candidates for new operational premises.
THE SUCCESS STORYThe market was very much against us and our client, with vacancy extremely tight and very few options on the South Bank, where our client was based and wanted to remain.
The News Building (colloquially known as the Baby Shard), emerged as the perfect solution as it was a) financially viable, b) could satisfy ED&F Man’s long-term growth plans and c) the more modern building could provide better space and infrastructure particularly for the clients’ demanding and growing Capital Markets trading team - and d) was perfectly situated at London Bridge Station!
In parallel with Cotton’s renegotiations, ask-re negotiated a long-term lease with a significant rent-free period in excess of £3m. In addition, the first rent review was capped providing protection for the client against rent inflation and giving further rent savings in future.
In a difficult market, we are proud to have been involved in one of the biggest leasing transactions on the South Bank, which delivered far better accommodation at lower cost for the long-term benefit of the business.