Derwent approves two London schemes after post-Brexit review

Aaron Morby 5 years ago
Share

Developer Derwent London has approved construction starts on two major projects in the capital as demand for space outstrips last year.

Laing O'Rourke will now deliver the Brunel building in Paddington
Laing O'Rourke will now deliver the Brunel building in Paddington

The firm decided to go-ahead with its new Brunel building in Paddington and the revamp of the former Saatchi building at 80 Charlotte Street in Fitzrovia after seeing rental rates rise in the West End and Tech belt of London.

The two projects will involve a further spend of £320m on top of preliminary works at both sites.

In a trading statement this morning John Burns, chief executive officer, said: “We are encouraged by our letting and disposal activities since June.

“Despite uncertain market conditions, our brand of good quality space at mid-market rental levels continues to attract occupiers.

“Given our positive lettings and sound financial base, we are progressing our major developments in Paddington and Fitzrovia, which are both due for completion in 2019 and expected to deliver attractive returns.”

Contractors Multiplex and Laing O’Rourke have been waiting for a final decision on the major projects since the Brexit vote.

80 Charlotte Street saatchi

The former Saatchi building revamp will see Multiplex deliver the 336,000 sq ft of office, residential and retail space and 31,000 sq ft of residential at nearby 65 Whitfield Street and 1-8 Whitfield Place.

Derwent’s Fitzrovia project has been in the pipeline for several years.

Derwent put the project on hold in July 2013, after advertising giant Saatchi & Saatchi, which has occupied the building since 1975, delayed its move away from the property.

Laing O’Rourke landed the £116m fixed-price contract for the new 16-floor Brunel building in Paddington last year.

Derwent had given the go-ahead for the ground works and the basement box, due to be completed by the second half of 2017, but was reviewing whether to go to full construction on the basis of post-Brexit vote office demand.

Derwent Brunel House

The 240,000 sq ft building will feature an innovative external steel diagrid structure, reminiscent of Laing O’Rourke’s Cheesegrater office project in the City, which will enable column-free internal areas and will have two large roof terraces on the upper floors.

Burns added: “The central London office market faces a number of challenges, including heightened global uncertainty, and business activity is likely to slow.

“It is times like these that demonstrate the benefits of the core elements of our business model: the provision of good quality space at mid-market rental levels founded on a conservative financial structure.

“We are very encouraged by our letting progress, especially since June, and remain committed to our two major projects completing in 2019 where we believe that the risk/reward profile is attractive.”

Latest news

514-home London scheme clears final hurdle

Inland Homes declares victory after three-year planning battle over Hillingdon Master Brewer site
9 seconds ago

First mass built carbon negative homes get underway

St Modwen first volume developer to build affordable carbon-negative homes
33 mins ago

GMI Construction names new CEO

Lee Powell takes helm as CEO at GMI Construction in growth push
37 mins ago

Henry Construction wins £30m Clarion housing scheme

Ravensbury estate regeneration in Mitcham is Henry's first project for Clarion
42 mins ago

Ballymore pulls 51-storey tower plan amid fire safety concern

London Fire Brigade raises concern about single staircase and fire strategy
3 days ago

New work surges as materials shortages ease

Mild weather and easing of supply chain bottlenecks lifts new work 5.7%
3 days ago

PDR Construction goes into administration

All staff made redundant as suppliers owed millions
4 days ago

Brick-laying robot gets approval from NHBC

Robot can now be used in construction of new homes covered by NHBC warranty
3 days ago

Temporary visa scheme needed for London sites

Mayor of London demands action over site skills shortages
4 days ago

Construction worker dies after fall from mobile tower

Court hears how tower wasn't configured correctly
4 days ago

Glencar wins £50m Peterborough logistics hub

Works start on trio of sheds at Kingston Park
4 days ago

Green light for £330m Woking high-rise cluster

Work to start on five blocks towards the end of 2022.
4 days ago

Countryside chief executive makes sudden exit

Major shareholder takes seat on board as first quarter trading falls below board expectations
4 days ago

Big names line-up for £2.7bn Birmingham roads deal

Arup, Arcadis, Balfour Beatty, Carnell, Colas, Kier and Tarmac among firms eyeing contract
4 days ago

Galliford Try scoops £56m Milton Keynes PRS job

Building arm will deliver 329 rental flats across four buildings rising up to 11 storeys
5 days ago

Designers shortlisted for £1bn Oxford Innovation district

Oxford Uni and L&G advance £1bn Begbroke science district plan
5 days ago

Subbies chase cash as work stops on PDR Construction sites

Subcontractors left in dark by £83m turnover contractor
6 days ago

Britain’s concrete producers join forces

Industry agrees single voice through lobbying group UK Concrete
4 days ago

Shapps pauses Smart motorway rollout amid safety concerns

Contractors will be allowed to complete schemes currently under construction
5 days ago

Wildgoose went down owing £9m to trade firms

More than 700 firms have been left out of pocket by the £50m turnover business
5 days ago

Keltbray bags Silvertown tunnelling waste removal

Riverlinx tunnelling team sign Keltbay to barge out excavated material
5 days ago

Ray O’Rourke’s successor starts work

Seamus French starts countdown to firm's founder stepping down
6 days ago

Filler injections rejuvenate ageing concrete roads

Metrail Construction solves squelchy concrete road problem with resin injections
5 days ago

McAleer & Rushe wins £42m Norwich student conversion

Crispin House office to be converted into 680 student rooms
6 days ago

Vinci completes first pour of its ultra low carbon concrete

Taylor Woodrow reduces the carbon footprint of the construction project by up to 70%
6 days ago

KPMG admits financial regulator misled in Carillion audits

Tribunal over KPMG and former staff's forgery allegations gets underway
6 days ago

Scottish contractor goes under with loss of 33 jobs

Iain Potter Construction hit by rising costs and problem contracts
6 days ago

Construction blasted over slow building safety culture change

Dame Judith Hackitt accuses firms of hiding behind trade bodies and holding on for legislation to force change
6 days ago

Firms making £10m-plus profits told to fund cladding retrofits

Developers handed March deadline to set out plans to fix unsafe 11m-18m tall buildings
7 days ago

Modular specialist OEP UK lines-up new contracts after prepack deal

Administrator's report reveals details of sale and debts to suppliers
6 days ago

Contractor services