Jo Watts, managing director of Watts Property Consultants, said recently-refurbished buildings were proving particularly attractive to tenants, with landlords being encouraged to invest more into their properties in order to minimise void periods and entice top-quality tenants.
‘Although it might be a bit more expensive to spend a bit more money on creating that high-quality product, it certainly pays dividends,’ she said.
One of the latest examples of refurbishment work is the transformation of Arnold House on St Julian’s Avenue.
Originally built in the 1980s, the building has undergone a full strip-out and refit on its upper floors.
Sustainability – something Ms Watts said tenants were increasingly prioritising – has been at the heart of the work, with the project achieving an ‘excellent’ sustainability rating from standards body BREEAM.
‘There’s good interest in it,’ Ms Watts said.
‘It’s looking fantastic inside, and it’s in a good location at a medium-level price point which is why I think it’s been attracting some interest.
‘It’s a solid example of a good-quality building that suits financial and professional services businesses looking for a single-floor product in a good location.’
She said St Julian’s Avenue remained an attractive place to be, with car parking, amenities and several professional services businesses all nearby.
‘Being on the main stretch into town where you’ve got the traditional financial services district and the newer one along Glategny Esplanade, you’re right in the hub of the activity.’
Since the completion of the redevelopment of Admiral Park, Ms Watts said there had been a ‘flight to quality’, with tenants demanding better quality buildings.
She said the new buildings and refurbishments had ‘upped the bar’ in terms of what tenants were expected to provide for their staff and clients.
‘We’ve seen a real split in the market, you’ve got the newly refurbished stock which is where the market is, against the other buildings which don’t have those design-led features or personality and are struggling.
‘In order to compete effectively and stay ahead of the game, we’re really noticing that landlords are needing to bring something a little bit different to the market, whether that’s through designer interiors or sustainable benchmarks.’
Overall demand was described as ‘steady’, with a limited supply of top-tier buildings.
However, Merchant House on Hirzel Street, a prime institutional-grade office building with more than 19,400 sq. ft of space, currently being marketed by Watts Property Consultants, had already attracted ‘strong’ inquiries for both whole-building and single-floor lettings.
Demand for Mill Place, a space on Due du Pre, at the smaller end of the market, was similar.
While office layouts had evolved since the pandemic, with more collaborative areas and flexible design, Ms Watts said there had not been a widespread move towards downsizing.
‘People still want to be in the office. They want the separation between home and work and the opportunity to work alongside colleagues.’