The UK’s longest running on-off office requirement has finally been settled following Deutsche Bank’s decision to open what will be its largest London office at Canary Wharf.
The German banking giant, which has considered a move to the capital’s eastern financial district for two decades, is now under offer to lease 350,000 sq ft at 10 Upper Bank Street, E14.
It will sub-let the space from law firm Clifford Chance, which prelet the 1m sq ft tower in 2000.
Deutsche will occupy three podium floors of around 50,000 sq ft each in the building, as well as floors six to 12 and floor 16 in the 30-storey tower.
It has agreed a blend of rents ranging from just over £35 per sq ft to just under £40 per sq ft on sub-leases which expire at the same time as Clifford Chance’s lease in 2028.
China Life, the Qatar Investment Authority and Canary Wharf Group bought the building for £795m last year.
Staff will be moved from several of Deutsche’s 16 London offices, with a significant proportion coming from 6-8 Bishopsgate, EC2, where the bank occupies 147,000 sq ft.
That building is due to be redeveloped by Mitsubishi Estate Company into a 40-storey tower once Deutsche’s lease expires in 2017.
Staff in Deutsche’s infrastructure division will be among those making the move to Canary Wharf.
While Winchester House, EC4, will remain the bank’s symbolic London headquarters, the 312,000 sq ft Square Mile base is marginally smaller than the new Canary Wharf office.
Overall, however, more staff will continue to be based in the City than Canary Wharf. Deutsche has extended its leases at other significant Square Mile buildings, including 1 Appold Street and 99 Bishopsgate, both EC2.
A spokesman for the bank said: “Like any large company, Deutsche Bank constantly reviews its location strategy to ensure that it provides flexible and cost-efficient workplaces.
“We are reconfiguring and reducing our space in higher-cost locations in London, New York, Singapore and Hong Kong. To date, we have reduced the number of buildings we occupy in London from 21 in 2010 to 16.”
The deal, which is under offer but not yet signed, would be a big boost for the London office market, significantly reducing the volume of secondhand space available in Canary Wharf and further limiting options for tenants looking for cheaper deals.
The fact that Deutsche – long seen as perennially indecisive among City agents – has finally committed to a major new Docklands base will be seen as a sign that even the most uncertain of tenants feel compelled to secure space as soon as possible before rents rise further.
JLL advised Deutsche Bank; CBRE and GVA are acting for Clifford Chance.
Will they won’t they – 20 years of Canary flirtation
1995 Deutsche enters negotiations for a 250,000 sq ft prelet at 25 North Colonnade, E14, before opting to move to Winchester House, EC4, instead.
2000 Colin Walkinshaw, director of UK real estate, launches review of entire London estate to examine options for a consolidation. Canary Wharf is considered the best option at the time to accommodate the bank’s 1.5m sq ft requirement.
2012 Shortlists 25 Churchill Place, E14, for a 150,000 sq ft prelet but instead opts to extend its lease at 6-8 Bishopsgate, EC2, by two years.
2014 The bank quietly explores potential for a major consolidation into 100 Bishopsgate, EC2, a 1m sq ft building it has considered on several previous occasions.
2015 Regears leases at multiple large City offices to 2023, then launches 400,000 sq ft requirement for cheaper space outside the Square Mile.
