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“We need to dispose of our lease – and fast!” was how John Brutnell, General Manager at global business aviation group ExecuJet (UK) Ltd summed up his instructions to McCalmont-Woods to dispose of a surplus 2,200 sq ft of office space on Level 34, One Canada Square in Canary Wharf, E14.

Working jointly with Studley, McCalmont-Woods drew up an initial marketing report setting out the leasing options available to the existing tenant and making various recommendations to ensure a speedy disposal for ExecuJet. The lease was successfully assigned to online business news provider IB Times just two months from receipt of client instructions – a feat all the more remarkable because no formal marketing was ever undertaken!

 

Abbey Business Centres was established in 1998 and was privately owned by The Lord Laidlaw of Rothiemay, one of Scotland’s most successful businessmen and philanthropists.

 

Background

Abbey Offices was keen to expand its network of sites across central London by opening a new prestigious facility located in the City core to compliment its other 13 centres across the UK.

When, in June 2008, Swiss Re took the decision to release the 15th floor at 30 St.Mary Axe, EC3, McCalmont-Woods quickly introduced the accommodation to Abbey Offices. The premises comprised 17,000 sq ft of fitted-out office space on the highest floor occupied by Swiss Re in the iconic ‘Gherkin’ building with commanding views over the City of London and across to the West End and Canary Wharf.

 

Outcome

Initially, Swiss Re had been seeking to let its surplus offices on a traditional lease (at a quoting rent of £62.50 per sq ft) but McCalmont-Woods was able to convince the Swiss insurer to instead enter into an Operator Management Agreement (‘OMA’) with Abbey Offices and after twelve months exhaustive negotiations, Abbey Offices opened its new City business centre in June 2009. The innovative structure of the OMA required a detailed financial model to be constructed, enabling both parties to benchmark future operating success.

 

Julie Calder, Managing Director
“Nick McCalmont-Woods has represented Abbey Business Centres for three years, initially in his previous position, but when he set up on his own, it was an obvious move for me to continue to use his services. Nick is a professional who sets himself apart by being clearly focused on understanding his client’s ultimate requirements and then securing them.”

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Occupiers often complain that their agents always pursue the easiest option to get a deal done. But McCalmont-Woods has a markedly different approach. Following 12 months of extensive negotiations on behalf of Abbey Business Centres, McCalmont-Woods acquired 17,000 sq ft on the 15th floor of the iconic ‘Gherkin’ skyscraper 30 St. Mary Axe, EC3 from Swiss Re under an OMA (Operator Management Agreement).

The innovative structure of the OMA required the creation of a detailed financial model, the assumptions of which were agreed by both parties and provided the benchmark against which to measure operating success. McCalmont-Woods’ successful completion of this instruction brings the amount of business centre space in the Foster-designed landmark tower under Abbey Business Centres’ control to c.44,000 sq ft over 3 floors.

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Leading specialist liability insurance provider Marketform instructed McCalmont-Woods on its 20,000 sq ft City office rent review at 8 Lloyds Avenue, EC3 in July 2009.

The instruction is seen as a valued endorsement of McCalmont-Woods’ ethos and expertise. Founding director Nick McCalmont-Woods originally acquired the building for Marketform in 2004 and sub-let part of the ground floor the following year.

Commenting on the appointment, Marketform Management Services Director James Romer-Lee said: “It is incredibly important for any business to be able to trust its consultants. McCalmont-Woods has always delivered a level of service and bespoke expertise that is difficult to find elsewhere.”

Acquisition of 1,000 sq ft in 6 Lloyd’s Avenue, EC3 for Simpson & Marwick.

McCalmont-Woods’ first acquisition! A referral from existing client Marketform to the Scottish law firm Simpson & Marwick.

 

Background

Cazenove Capital Management occupied 34,000 sq ft at 12 Moorgate, EC2 under a 25-year lease dating from 1998. Prior to selling its freehold interest in the property, landlord New Star Property Asset Management sought to increase the annual office rent payable at review from £47.00 per sq ft passing to a new rent based on a highly optimistic £60.00 per sq ft.

McCalmont-Woods was referred by its existing client JP Morgan Cazenove and was subsequently instructed by Cazenove Capital Management to negotiate the upward only rent review with a view to mitigating any uplift in rent payable as at the 24th June 2008 review date.

 

Services Provided

  • Consideration of existing lease contract and provisions for rent review
  • Market research (analysis of City offices market and comparable market evidence at valuation date)
  • Preparation of initial client report outlining McCalmont-Woods’ strategy for handling the review
  • Property inspections (subject premises and market evidence);
  • Negotiations and settlement of rent review

 

Outcome

McCalmont-Woods negotiated a minimal uplift of 1.5% on the rent passing. The settlement reached by negotiation between the parties (without the need for recourse to independent arbitration) represented a 83% saving for Cazenove on the uplift in rent proposed by its landlord.

 

Stewart Norwood, Director, Head of IT
“Nick McCalmont-Woods carried out a rent review on our behalf. Throughout, his advice was clear and valuable, resulting in a very positive outcome for the firm. He combines an expert view with a commercial approach, thus making sure all options are understood, strategy agreed, then effectively implemented.”

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McCalmont-Woods negotiated an 83% saving for Cazenove Capital Management on the proposed increase on its 34,000 sq ft offices at 12 Moorgate, EC2 in June 2008.

Commenting on the minimal 1.5% uplift on the rent passing, Cazenove’s IT Director, Stewart Norwood said of founding director Nick McCalmont-Woods: “Throughout, his advice was clear and valuable, resulting in a very positive outcome for the firm. He combines an expert view with a commercial approach, thus making sure all options are understood, strategy agreed, then effectively implemented. He’s also extremely personable. I’d happily recommend Nick’s work to anyone.”

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The renewal of international information organisation Newsquest Specialist Media’s lease at its City headquarters 30 Cannon Street, EC4 represented a challenge of a different kind to its adviser McCalmont-Woods. This was because the existing landlord, international investment manager RREEF, was at the same time negotiating to sell its freehold interest in the building.

An extensive review of the City office market suggested one option was to relocate to an alternative property. But McCalmont-Woods was able to persuade Newsquest’s landlord of the merits of concluding a reversionary lease on its 12,000 sq ft offices. This solution provided RREEF with an income stream through the recession and enabled Newsquest to benefit from a low rent, together with additional lease flexibility and a service charge cap.