The “flight to quality” that’s benefitted owners of prime Manhattan properties is remarkably mirrored in London, the market that’s most relevant to New York’s.
According to Knight Frank, the UK’s leading property management and leasing firm, vacancy rates have plunged in the most desirable London submarkets and in the newest office towers especially — which should sound familiar to anyone in New York real estate.
Availability in new London towers with “best-in-class tenant experiences” and “sustainability credentials” plunged to a mere 0.3%in the West End district and 0.5% in the City of London.
Although no Manhattan area can boast of such low, district-wide vacancy, the most modern towers here — which are larger than London’s — are nearly as full.
Among the largest recent London deals are Citadel’s for 250,000 square feet at British Land’s 2 Finsbury Avenue, now rising and due for completion in 2027. The lease ups Citadel’s space in the city by two-thirds.
Ken Griffin’s firm is leading a financial-services surge that, as in New York, seems immune to market fluctuations. Citadel is the anchor tenant at the new 425 Park Ave. Griffin is also in talks for a mammoth lease at 660 Fifth Ave. even as he plans to anchor a new tower at 350 Park Ave.
Knight Frank noted that hedge funds, private equity tenants, merchant banks, asset and wealth managers have steadily increased their presence in the British capital “despite macro, political and economic headwinds.”