A West End office that epitomises the sector's London highs and lows of the past 10 years has won planning approval for a major refurbishment.
A joint venture between Mitsubishi Estate London and Dutch developer Edge received planning consent from Camden Council for the refurbishment of 125 Shaftesbury Avenue at an estimated cost of around £150M.
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The refurbishment will transform the existing 1980s structure into an extended 250K SF modern office building on Charing Cross Road situated on a 1.2-acre freehold site just south of Tottenham Court Road station.
Approximately 75% of the existing structure will be retained to significantly reduce embodied carbon, and the JV is targeting a BREEAM Excellent sustainability rating.
The joint venture paid £150M for the building, about £117M less than the previous owners, Korean Vestas Investment Management and Savills Investment Management, spent in 2018.
In summer 2017, Almacantar, the last owner but one, leased the entire 140K SF office portion of 125 Shaftesbury to WeWork on a 20-year lease at a rent of about £70 per SF. The lease was in the name of a special-purpose vehicle.
WeWork leased the entirety of its space to Facebook, now Meta, on a two-to-three-year lease a year later.
At the time, WeWork was keen to take on deals with large corporate occupiers to highlight that it had a big roster of blue-chip tenants ahead of a potential initial public offering.
Vestas and Savills IM agreed to buy the building, fully let with a long lease in place, in December that year.
By that point, however, Facebook had already agreed to a 600K SF prelet on brand-new office space in King’s Cross, which opened in 2021. The tech giant decided the flex office space with a short, easily breakable lease at 125 Shaftesbury was surplus to requirements and vacated the building.
Faced with a fully vacant building and needing to shed office space to preserve cash after its failed 2019 IPO attempt, WeWork handed the space back to the owners.
“It is well established that the West End office market is currently chronically undersupplied,” Mitsubishi Estate London Chief Executive Shinichi Kagitomi said in a statement.
“This approval will be welcomed by the occupier community, and we are looking forward to delivering much-needed new office space — and a major rejuvenation of an existing building — right in the heart of the west end.”
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