Investors should remember that the value of an investment and the income received from it can go down as well as up, and that they may not get back the amount they invested. Sage advice for any investor.

You may think it odd then that commercial office leases in the UK still provide for the annual rent agreed at lease commencement to be subject to rent review on an ‘upward only’ basis.

Rent reviews became common in commercial property leases during the 1960s and 1970s as a mechanism for adjusting existing lease rents to current market levels. They were devised specifically to protect the value of landlords’ interests in an inflationary environment whilst enabling tenants to secure traditionally favoured long-term leases.

In the UK rent reviews typically occur once every five years and it is now unusual to come across office leases that provide for a longer review pattern. Upward only means that the rent paid by the tenant cannot reduce at review time, even if the open market rent at the relevant review date is deemed to be lower than the rent passing.

Whilst it is too early to forecast how the market will fare post the immediate crisis, all of the tenant representatives and brokers we have spoken with intuitively feel that rents will come under downward pressure. Only time will tell!

The British Property Federation (BPF), the trade association for UK landlords, noted that the traditional upward-only rent review remains dominant in the UK commercial property market and, indeed, is seen by some as a major contributor to the attractiveness of the UK market to commercial real estate investors. Consequently, there is little appetite to change the ‘status-quo’, but occupiers are likely to think differently if exposed in a falling market to over-rented premises which prove both expensive and difficult to dispose of.

Intended to improve transparency and fairness in the negotiation of commercial leases, the new RICS ‘Code for leasing business premises’ (1st edition, February 2020) was an opportunity missed to pivot away from the constraints of upward only rent reviews.

With businesses haemorrhaging cash and searching for ways to stem the bleeding, occupiers across the retail, leisure and F&B sectors are actively seeking relief through rental waivers and deferred payments. Certain flexible space market (FSM) providers are closing down centres and seeking CVA arrangements to protect and survive. And, as various well-known retail brands enter administration, the case for business rates relief to enable the high street to compete with online retail grows ever stronger.

The shortening of leases over the past two decades has represented a major structural shift in the commercial property market. Rarely these days will occupiers sign-up for 25-year leases unless they are entering into very large lettings (and pre-lettings) or acquiring premises requiring a high level of fitting-out capex.

The average office lease length in the UK today is now closer to 5-years, having come in from the average lease length of 6.8 years in 2014. The impact of IFRS 16 requiring tenants to bring all operating leases on balance sheet (by recognising a ‘right-of-use’ asset and corresponding lease liability) may have also influenced some occupiers’ decisions to enter into shorter lease terms post January 2019.

As businesses review their space and headcount requirements, the risk for owners and investors is that faced with an upward only rent review and a significant deficit between the rent paid and market value, tenants will vote with their feet, exercising lease breaks which may be coincidental with the rent review. In extremis, they could even default, leaving landlords with unwanted vacancies and possibly also significant rent arrears. Consequently, on new lease acquisitions it is to be expected that occupiers will gravitate towards those properties which offer more flexible lease terms, including enterprise spaces within the FSM sector, given the likely trade-off between pricing and lease flexibility.

With landlords facing billions of pounds in lost or deferred rents and expected to take another hit at the June rent quarter-day, there clearly needs to be a recognition of the problems faced by both owners and occupiers. It will be interesting to see whether the Covid-19 pandemic acts as a catalyst for change.

Since there has been little debate on the merits of incorporating upward and downward rent reviews in new lease agreements (maybe there are too many players with vested interests?) we asked our friends, Paul McDowell and Stuart Allison, to explain how rent reviews in Ireland and Australia work. Here’s what they had to say…

Paul R McDowell, Principal, Paul McDowell Ltd, Dublin:

“Up until January 2010, Ireland followed the UK practice of upward only reviews. However, these were banned by law following tenant lobbying pressure as a consequence of the 2008/9 economic crash. In reality, it has had little effect as rents in all sectors continued to increase following the historic lows of 2010. Some landlords now favour indexed rents at review with caps & collars. Obviously, future rent reviews will be more impacted as rents are destined to fall due to the current pandemic.

In terms of investment, it did create a marginal two-tier market between assets with pre or post January 2010 leases, but a move towards a pattern of shorter lease terms and 5-year breaks largely negated this difference. One now needs to make a more critical assessment of rental values when arriving at capital value decisions. However, such market reviews have had zero negative impact upon the large swathes of overseas investment flooding into the Irish market since 2010.”

Stuart Allison, CEO & Principal, ResolveXO, Melbourne & Sydney:

“Market rent reviews are becoming a less common feature in Australian commercial property leases with most landlords and tenants preferring to agree to annual increases across the term of the lease for certainty, typically 3% to 4% pa.

Rent reviews usually only occur in leases at the commencement of an option to extend the lease period but even then, both parties typically prefer to work out the terms of any renewal package in advance, with landlords preferring higher face rents, and tenants preferring to negotiate and receive more generous incentives.

This is a change on 20 years ago where upwards only (known as ratchet clauses locally) face rent reviews were commonplace. While rental growth has been consistent since, incentive packages have been on a roller coaster and this has driven both parties to work towards a process that allows for a closer outcome to market. We are even seeing clauses now that require the determining valuer to provide a determination on the rent and market incentive!”

We are keen to hear your views on any issues affecting corporate occupiers, and how businesses might adapt and evolve in the new normal. Please e-mail us with your thoughts.


When life returns to normal after Covid-19 has abated, the big question for many businesses will be “what does normal look like?” After analysing their business’s response to social distancing measures, for some corporates there is likely to be a realisation that they are renting more office space than they actually need. GoSpace AI Chief Partnership Officer Neil Usher notes that every company that has conducted a space utilisation study has consistently found that between 25-50% of desks are unused throughout a day.

Factor in the impact of the Minimum Energy Efficiency Standard (MEES) Regulations on older inefficient office properties, and we arrive at a scenario where occupiers are exiting sub-standard office stock and concentrating core business activities in the best and most efficient real estate. With a breaking down of perceived cultural resistance to remote working perhaps the next big question to ask is ‘where should those core activities be located?’

We are keen to hear your views on how businesses might adapt to the new normal. Please email us with your thoughts.

Thank you and, please be more careful than you think you should.


With businesses hurting across the UK and tenants looking for financial support during the coronavirus crisis, occupiers are advised to check the terms of their lease and any insurance policies held to establish if they have grounds for relief as the Chancellor Rishi Sunak set out the following package of temporary measures to support businesses:

• a Coronavirus Job Retention Scheme
• deferring VAT and Self-Assessment payments
• a Self-employment Income Support Scheme
• a Statutory Sick Pay relief package for small and medium sized businesses (SMEs)
• a 12-month business rates holiday for all retail, hospitality, leisure and nursery businesses in England
• small business grant funding of £10,000 for all business in receipt of small business rate relief or rural rate relief
• grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000
• the Coronavirus Business Interruption Loan Scheme offering loans of up to £5 million for SMEs through the British Business Bank
• a new lending facility from the Bank of England to help support liquidity among larger firms, helping them bridge coronavirus disruption to their cash flows through loans
• the HMRC Time To Pay Scheme

The above measures are unlikely to offer much in the way of succor for the majority of corporates and all of the legal opinion we have studied is consistent in advising that (subject to certain exceptions) tenants are not entitled to: a) terminate leases because they choose to close their business or can no longer afford to pay rent (unless entitled to do so under the terms of an existing break option), b) withhold rent or pay a reduced amount due to cashflow problems and, c) cease paying business rates. Note, service charges are usually reserved as rent.

Our advice is that occupiers (and/or their tenant representatives) should actively engage with their landlords at the earliest opportunity to discuss the options available, as there are a range of other solutions which could potentially provide some relief during this period of disruption.


There is an important partnership that transcends the Atlantic and connects some of the world’s leading businesses in the Energy Sector.

It is a partnership that delivers expert local market knowledge, trans-continental support, guaranteed unconflicted advice and the highest quality outcomes.

Introducing a very special partnership of acknowledged experts in both Independent Tenant Representation and the particular needs of the Energy sector.

McCalmont-Woods Real Estate ( and The Calibre Group, Inc. ( – a Partnership for Energy.

DOWNLOAD our new brochure to find out how to gain instant advantage for your real estate requirements.


The challenges facing corporate occupiers are legion. In a world as unfamiliar to many businesses as corporate real estate, the prospect of ‘going it alone’ can be truly daunting – and not without reason.

Office relocation, disposals and rent review processes are typically highly complex transactions fraught with pitfalls, which could potentially prove extremely costly to the organisation concerned.

For any corporate occupier embarking on acquiring or disposing of a property or negotiating the renewal of a lease with a landlord or a rent review, there are numerous and varied questions, considerations and issues that need to be addressed.

To help corporate occupiers grasp the situation, MWRE has produced a brief, no-nonsense Guide to Independent Tenant Representation to assist them in making more informed decisions.

From the 10 key questions that confront the critical issues facing corporate occupiers to how you can de-risk your situation, together with real-world examples, we hope this brief Guide will be of interest to you.

Please download your priority copy of the Independent Guide to Independent Tenant Representation, with our compliments.

The 4th July is a special day for our American friends. This is the day on which Congress adopted the Declaration of Independence from Great Britain in 1776. Independence Day is a national holiday in the USA to be celebrated with family and friends, parades, more parades and of course fireworks, lots of them!

Thomas Paine, English-born American political activist and one of the Founding Fathers of the U.S. inspired the rebels to declare independence from Britain and inspired me to also think about what it means to be independent.

In a business context, a firm’s ability to provide clients with advice “free from outside control; not subject to another’s authority” and “not influenced by others: impartial” (as defined by The Oxford English Dictionary) may be hampered by conflicts of interest arising from the supply of services and issues around ownership, the nature and identity of outside investors and other stakeholders with an involvement in the business. And of course, limited market competition is also seen as being damaging to business.

In 2011 the European Commission unveiled proposals to force the UK’s Big Four accountancy firms to separate their auditing services from their consultancy work in an attempt to restore credibility to European auditing firms after “considerable failures” around the 2008 financial crisis. The collapse of Carillion plc (a British multinational facilities management and construction services company) in June 2018, costing UK taxpayers an estimated £148m, caused the UK’s accounting regulator to again raise competition concerns.

Carillion’s demise, following a series of other high-profile corporate accounting failures, re-focussed debate on whether or not the big-four accountancy firms should be broken up with Stephen Haddrill, Chief Executive of the Financial Reporting Council calling for an investigation to consider forcing audit firms to divest their substantial and lucrative consulting work and various experts arguing for and against.

Natasha Landell-Mills (Head of Stewardship at Sarasin & Partners) writing in the Financial Times (Should the Big Four accountancy firms be split up? 21.03.2018) argued that separating audit from consulting would prevent conflicts of interest, observing that conflicts are exacerbated when audit firms also sell other services to management teams, particularly if that consultancy work is more profitable. In the same article Jim Peterson (author ‘Count Down: The Past, Present and Uncertain Future of the Big Four Accounting Firms’) countered that forcing Deloitte, EY, KPMG and PwC to shed their non-audit businesses would neither add competition nor boost smaller competitors, because the root problem is global and reflects the big-four’s multinational clients’ needs for breadth of geographic presence and specialised industry expertise.

The parallels with the real estate sector are all too evident with the five largest professional services firms in CBRE, JLL, Cushman & Wakefield, Colliers and BNP Paribas dominating. As firms sought to grapple with various issues impacting the professional services sector, principally the problem of how to deal with falling revenues and escalating costs, the real estate sector responded with a spate of high profile corporate mergers, the more notable being Savills acquisition of Studley in the U.S. in 2014; Cushman & Wakefield’s merger with DTZ in 2015 and latterly the French bank owned BNP Paribas Real Estate’s acquisition of Strutt & Parker in 2017, which it can be argued has reduced market competition and in the process limited customer choice.

But mergers can also lead to de-mergers. A case in point being Deloitte which expanded the size of its real estate business and transactional element in particular when it bought Drivers Jonas in 2010. Following a strategic review of its agency and investment businesses it subsequently agreed to offload the majority of its transactional staff just six years later, the review prompted due to conflicts of interest arising from being part of a big-four accountant and US Securities and Exchange Commission regulations. The acquisition of GVA by Germany’s Bilfinger in 2014 was also relatively short-lived but for different reasons, with a sale to EQT completed two years later. The Swedish private equity firm is reported to have begun market-testing another sale of the business (EGi 09.05.2018).

Deloitte Real Estate’s Managing Partner Nigel Shilton said “If you look at the transactional side of things and the consolidation in the market, it is not getting any easier to compete. You need to either be niche and boutique or large and global” (EGi 18.04.2016). With AI, blockchain, crypto-currencies and robotics reshaping the way in which data is gathered, stored and verified, businesses will need also to embrace change and adapt to new markets and technologies if they are to stay relevant.

In an article for CFO Magazine (Is Analytics the Answer? 27.06.2018) Avocat Group’s CFO Walt Batansky explained how his commercial real estate consultancy in the U.S. is currently beta testing a system that automates previously manual tasks. It will, for instance, comb through clients’ current lease information and compare it to market data to find variances and if market rents are significantly lower than is being paid by the client, the client may wish to consider renegotiating its lease terms or acquiring additional space at more attractive rental rates. The system can also send alerts for upcoming lease events and calculate real estate costs as a percentage of revenue and then compare real-estate-cost-per-revenue-dollar for each client location.

The desire to innovate and specialise may contradict the ‘one-stop-shop’ approach to business favoured by many of the established behemoths and cut across the old-fashioned notion that ‘big is best’ but my belief is that the ‘one-stop-shop’ model is no longer fit for purpose and that a firm’s ability to operate globally and act locally should not be dependent upon the ownership of its business. The good news for clients is that a plethora of independent firms is already busy collaborating across the globe to provide the highest calibre professional advice across the legal, accounting, management consultancy, architectural and real estate arenas via a network of business relationships which allow members to share resources, knowledge and skills and challenge the status quo.

McCalmont-Woods Real Estate’s exclusive focus on providing a specialist tenant representation service to corporate occupiers enabled us to navigate our way through the global recession and flourish and this year, 2018, sees us celebrate our 10th anniversary. As the UK member of the Alliance of Tenant Representatives McCalmont-Woods’s clients benefit from a network of affiliated offices across North America and since independence defines McCalmont-Woods, we are on this special 4th July day proud to declare our own independence!

We may not have a Bill of Rights, but we can promise to always:
1. Listen and respond appropriately to your business needs;
2. Act in your best interests with the highest standards of client care and integrity; and,
3. Ensure that all clients (irrespective of size) shall benefit from thoughtful, diligent and creative tenant representation.

And since we only act for occupiers of business space, we can also guarantee that client’s interests will never be subordinate to conflicting relationships with landlords or property owners, which as Thomas Paine might have said, “all makes perfect Common Sense”.

Independent firms are often viewed as innovators and sometimes disrupters, but what unites them is the increased choice they provide to clients seeking specialised industry expertise. So if you are interested in learning more about tenant representation in real estate we would invite you to contact us to receive your priority copy of our Guide to Independent Tenant Representation (available to download shortly).

McCalmont-Woods Real Estate, the specialist London based Tenant Representation real estate agency, is proud to have advised Neptune Energy on relocation to its new London office at Land Securities and Canada Pension Plan Investment Board’s Nova development in Victoria, SW1.

Neptune is an independent international E&P company and, having completed the acquisition of the exploration and production business of the ENGIE group in February 2018, is now active across the North Sea, North Africa and Asia Pacific. The Company is backed by funds advised by three investors, China Investment Corporation, The Carlyle Group and CVC Capital Partners.

Neptune has taken 11,000 sq ft offices at Nova North bringing the total office floorspace acquired and let by MWRE for energy sector clients in London to date to over 130,000 sq ft.

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On 28th January 2008 the markets were bracing themselves for more volatility, the Chancellor of the Exchequer had just handed more power over banks to the FSA and Lembit Opik was making headlines dating a Cheeky Girl.

Also, McCalmont-Woods opened its doors, and never looked back.

We are delighted to announce 10-years of independent Tenant Representation real estate business. It’s been a hugely fulfilling journey and a milestone of which we are immensely proud.

£300 million rental commitments and counting

McCalmont-Woods Real Estate’s positive ‘can-do’ attitude and our exclusive focus on serving the interests of corporate office occupiers has resulted in McCalmont-Woods advising on in excess of £300 million rental commitments to date across London’s prime real estate districts, from office acquisitions and disposals to rent review and lease advisory services.

A big, big thank you

Since our clients are at the heart of everything we do, we should like to take this opportunity to thank you all for your incredible support and friendship over the last ten years.

McCalmont-Woods will always champion your property requirements as trusted advisors, and guide and advise you at every step to deliver the best possible outcomes for your business.

What’s more, our services are extending overseas – more on which will be announced soon!

To all our clients and industry friends, our very best wishes for the next 10 years and a very prosperous 2018 to you all.

Newsquest Media Group Limited advised by tenant representation specialists McCalmont-Woods Real Estate LLP has taken a new lease on Queen’s House, 28 Kingsway and 55-56 Lincoln’s Inn Fields, WC2 in London’s Midtown district from Capel House Property Trust Limited advised by Gale Priggen & Co.

Newsquest has signed a new lease on the 3,700 sq ft part 4th floor in Queen’s House, an impressive period property situated on the west side of London’s largest public square. Initially planned in 1913, development was put on hold in 1914 due to the outbreak of the First World War and the building was only subsequently completed in the early 1920s since when it has remained in the ownership of landlord Capel House ever since.

Lincoln’s Inn Fields, originally laid out in the 1630s with a brief interruption for the English Civil War (1642-1651), has long had an association with the legal sector and over the years has been home to numerous solicitor’s firms and barristers’ chambers. In Charles Dickens’ novel Bleak House, the sinister solicitor to the aristocracy, Mr Tulkinghorn, has his offices in Lincoln’s Inn Fields!

Today the Square is home to some of London’s most noteworthy organisations including the London School of Economics and Political Science who also occupy space in Queen’s House and next door in a £71 million state-of-the-art building at 50 Lincoln’s Inn Fields. Other notable occupiers in the Square include international public relations company Brunswick Group; the Royal College of Surgeons and the Centre for Commercial Law Studies – part of Queen Mary, University of London. The Sir John Soane’s Museum, which attracts over 100,000 visitors a year, occupies no. 13 Lincoln’s Inn Fields, the house being left untouched since the distinguished architect’s death almost 180 years ago.

Earlier, in June of this year, McCalmont-Woods advised Newsquest’s Specialist Media arm on its relocation from 30 Cannon Street, EC4 to 6,000 sq ft ‘creative style’ offices at 120 Leman Street, E1 in the heart of London’s vibrant Aldgate quarter on the east side of the City. Newsquest Specialist Media, who publish both commercial and B2B titles such as Insurance Times, Strategic Risk and Global Reinsurance amongst other brands, signed a new lease on the refurbished offices with landlord Grainmarket advised by Hall Kemp.

Lisa Isaac, Group Purchasing Manager at Newsquest said “Having met with several potential advisers, the team at McCalmont-Woods impressed us with the way they focused on our needs and brief, finding the property to fit as opposed to starting with available properties and trying to shoehorn the brief to match. We had some tough ‘asks’ and we certainly put Nick’s extensive experience and market knowledge to the test. The Specialist Media team were very pleased with the move to Leman Street and we had no hesitation in appointing McCalmont-Woods to help find our second property in Midtown; a second successful project despite the incredibly tight deadlines. Knowledgeable, jargon-free, helpful and focused, I look forward to working with McCalmont-Woods on future projects.”

Newsquest is the UK’s second largest publisher of regional and local news with a portfolio of more than 165 news brands and over 40 magazines, published in print and online. With an audience of almost 30 million users a month online and 6 million readers a week in print, Newsquest’s content is read by a substantial proportion of the UK population. Newsquest employs over 1,000 experienced media sales people that help local businesses promote their products and services to local audiences. Newsquest is owned by Gannett Co., Inc. the largest news publisher in the United States whose assets include USA Today and USA Weekend. Gannett is listed on the New York Stock Exchange with the symbol “GCI”.

Faced with the imminent expiry of its office lease in 33 Grosvenor Place, Belgravia, Hartree Partners (UK) Limited turned to tenant representation specialists McCalmont-Woods Real Estate LLP for help in finding a new London office space.

Working to a tight timetable and with Victoria offices in scarce supply, McCalmont-Woods successfully identified and negotiated a new lease on 11,300 sq ft Grade A space at Cardinal Place, 100 Victoria Street, SW1 with landlord, Land Securities.

Formerly occupied by Microsoft, the 2nd floor offices needed refurbishment and in recognition of the tight timescales involved, it was agreed that office design & build specialists’ Peldon Rose would undertake both the landlord’s Cat A works and Hartee’s own Cat B fitting-out works in order to accelerate Hartree’s move-in date.

Land Securities’ 660,000 sq ft Cardinal Place is undoubtedly one of the most recognisable sights in Victoria, the dramatic sweep of its glass facade narrowing to a single point at the corner of Bressenden Place and Victoria Street. A new entrance to the underground and north ticket hall (providing improved access between the National Rail and Tube platforms) is due to open shortly immediately opposite the entrance to Cardinal Place.

Jon O’Neill, Hartee’s Managing Director said “Nick did a great job of finding a new London office space for Hartree. We appointed him after a previous property deal fell through at a late stage, leaving us with a relatively tight timeline to find new office space. Nick worked hard and found us a great space before it got advertised on the open market. He is a good communicator and we felt very well informed throughout the whole process; we would not hesitate to use him again”.

Hartree Partners, LP is a global merchant commodities firm specializing in energy and its associated industries. Founded originally as Hess Energy Trading Company LLC (HETCO) in 1997, Hartree has a global reach spanning 10 offices and approximately 85 traders and originators. The company’s rigorous research, analytical approach, and entrepreneurial culture have contributed to its strong track record and growth over that time.