Central London Fit Out Report March 2008
Sharing the Fit Out ‘Cake’
The Central London Interiors Market
March 2008
Introduction
This research into the central London interior fit out market by Metropolis Property
Research has been prepared for MIPIM March 2008.
Andy King is Managing Director of Metropolis Property Research and a Director of
CityOffices.net
The Context
As part of the research Metropolis has identified the larger office lettings and re-stack
projects in central London for the period 2004 to 2008 (so far) and where possible
the project teams. The research covers projects of 1,858 sq m (20,000 sq ft) + and
has been prepared in consultation with the major firms active in the market.
This original and independent research has allowed us to compile a new London Top
10 Rankings of interior architects and fit out contractors for MIPIM.
A Bigger Slice of the Cake
The research looks at one slice of the whole central London interior ‘cake’ and is
focussed on the fit out (Category B) of new and refurbished Grade A space based on
agreed lettings.
The total take-up of all office space in central London 2004-2008 (so far) has been
just over 50m sq ft, and large deals, which form the basis for the Top 10 research,
amounted to 28.7m sq ft.
For the first time the research has looked at another slices of the interior market
namely re-stack (fit out/refurbishment with occupier in occupation).
The only ‘slice’ that does not form part of the analysis is the fit out /refurbishment of
vacant speculative office space. It is hoped to provide an overview of this last
remaining aspect of the London interior market in the next report.
The re-stack market is estimated at around 6m sq ft for 2004-2008 (so far) and the
speculative refurbishment/fit out market is estimated to be at a similar level.
Central London Fit Out Report March 2008
Diagram 1
Central London Fit-Out Market ‘Cake’
(Major Projects Total Size 62m sq ft 2004-2008)
Spec Space
(estimate)
15%
Re-Stack
15%
Major Lettings
70%
Source: Metropolis Property Research (www.metroinfo.co.uk) and CityOffices.net
(www.cityoffices.net)
The following analysis of market share is in the context of the above figures.
Central London Fit Out Report March 2008
MCM Take the Lead - Interior Architect Market
The Top 10 Interior Architect Rankings for the combined totals for 2004-2008 are as
follows:
Interior Architects Ranking
MCM
Swanke Hayden Connell
Pringle Brandon
BID (Bennett Interior
Design)
Gensler
HOK
Sheppard Robson
Building Design Partnership
Woods Bagot
MoreySmith Architects
Source: Metropolis Property Research (www.metroinfo.co.uk)
Those firms in the Top 10 have dealt with, or are dealing with, nearly 14m sq ft of
‘live’ or recent interior projects, which comprises 50% of all office projects in central
London 2004-2008 reviewed as part of the research.
The actual interior fit out market share 2004-2008 (so far) of these firms is:
Central London Fit Out Report March 2008
MoreySmith
Architects 3%
Woods Bagot 4%
MCM 17%
BDP 5%
Sheppard Robson
7%
HOK 10%
Swanke Hayden
Connell 15%
Gensler 12%
BID 13%
Pringle Brandon
14%
Source: Metropolis Property Research (www.metroinfo.co.uk)
The Top 10 architect ranking now sees MCM overtake Swanke Hayden Connell to
take first place, with a 17% market share of major interior projects in central London.
MCM has had a particularly good year with its clients taking over 0.9m sq ft of office
space. This has enabled MCM to overtake the 1.3m sq ft of clients taking space that
took Swanke Hayden Connell to first place in early 2007.
Pringle Brandon keeps third place and for the second year and Gensler and HOK
have each moved up a place in the rankings as Sheppard Robson moves down the
ranking. Building Design Partnership (BDP) moves into the ranking for the first time.
Six firms now dominate the market with 82% of the major projects (Category B)
interior design work.
Central London Fit Out Report March 2008
Overbury Overtake ISG - Fit-Out Market
The market trend to more pre-lets activity means that the time lag on the
appointment of a fit out contractor can now be well over 12 months behind the
appointment of interior architect and project manager. This makes the Top 10
analysis of fit out more subject to change as the number of projects cover a
wider time frame than other sections of this report.
The Top 10 Interior Fit-Out Rankings for 2004-2008 are:
Fit Out Ranking
Overbury
ISG
Como
StructureTone
Skanska
Wates
BW Interiors
Ibex
Canary Wharf Contractors
8build
Source: Metropolis Property Research (www.metroinfo.co.uk)
Those firms in the Top 10 have dealt with, or are dealing with 13m sq ft of ‘live’ or
recent interior projects and this comprises 44% of all office these projects in central
London 2004-2008 (so far) reviewed as part of the research.
The actual interior fit out market share 2004-2008 (so far) of these firms is:
Central London Fit Out Report March 2008
8build 4%
Canary Wharf
Contractors 5%
Ibex 5%
Overbury 26%
BW Interiors 5%
Wates 6%
Skanska 6%
StructureTone 7%
ISG 25%
Como 11%
Source: Metropolis Property Research (www.metroinfo.co.uk)
Overbury has gained market share last year and has just replaced ISG at the top of
the ranking. The two firms continue to dominate the market, now accounting for 52%
of large fit out projects (Category B) in central London.
Como has held third place with an has increased market share since our last report.
BW Interiors has move up the ranking and 8build is a newcomer to the list.
There are currently 5.9m sq ft of ‘live’ projects in central London where the fit out
contract has still to be appointed. This is a 68% increase since our last review in
early 2007 and reflects the activity in the central London letting market over the last
18 months.
Central London Fit Out Report March 2008
Two Firms Dominate - Re-Stack Architects
The Top 10 Re-Stack Architect Rankings for the combined totals for 2004-2008 are
as follows:
Interior Architects Ranking
HOK
Pringle Brandon
MCM
Swanke Hayden Connell
TTSP
Gensler
Woods Bagot
HLW
BID (Bennett Interior
Design)
MoreySmith Architects
Source: Metropolis Property Research (www.metroinfo.co.uk)
Those firms in the Top 10 have dealt with, or are dealing with, close to 6.0m sq ft of
re-stack projects in central London 2004-2008 (so far) reviewed as part of the
research.
The actual re-stack market share 2004-2008 of these firms is:
Central London Fit Out Report March 2008
MoreySmith 2%
BID 3%
HLW 3%
Woods Bagot 4%
Gensler 5%
HOK 28%
TTSP 7%
Swanke Hayden
Connell 10%
MCM 16%
Pringle Brandon
22%
Source: Metropolis Property Research (www.metroinfo.co.uk)
In this new research on the re-stack market it is clear that HOK and Pringle Brandon
dominate, with a combined share of 50% of major central London projects.
Overall the top four firms account for 76% market share, with six firms taking the
remaining 26%.
Central London Fit Out Report March 2008
ISG Just Ahead - Re-Stack Fit Out
The Top 10 Re-Stack Fit-Out Rankings for 2004-2008 are:
Fit Out Ranking
ISG
Overbury
Ibex
Bovis Lend Lease
Mitie
Wates
BW Interiors
Como
Wallis
8build
Source: Metropolis Property Research (www.metroinfo.co.uk)
Those firms in the Top 10 have dealt with, or are dealing with nearly 5m sq ft of ‘live’
or recent re-stack projects in central London 2004-2008 reviewed as part of the
research.
The actual re-stack market share 2004-2008 of these firms is:
Central London Fit Out Report March 2008
8build 2%
Wallis 2%
Como 2%
BW Interiors 5%
ISG 24%
Wates 8%
Mitie 10%
Bovis Lend Lease
12%
Overbury 22%
Ibex 13%
Source: Metropolis Property Research (www.metroinfo.co.uk)
As with the central London interior fit out sector ISG and Overbury account for a
significant share of projects (46%), and at this point ISG is ahead.
The top six firms account for 81% of the market, and there are a few names, such as
Bovis Lend Lease, Ibex, and Mitie, which are better represented in the re-stack
ranking than on the interior fit out ranking.
There are several major re-stack projects due to be awarded in 2008 which may see
the positions in the ranking change.
Central London Fit Out Report March 2008
Prospects For 2008
In 2007 the take up of office space in central London at 15m sq ft was similar to the
previous year, although cut backs caused by the credit crunch are expected to lead
to a slow down in the London office market.
Although the credit crunch is not expected to be as severe as the down-turn in 2001
and 2002, it is estimated that between 6,000- 8,000 jobs in the financial sector could
go by the end of 2008.
At present there are indications that a few requirements are on-hold, but with at least
5.9m sq ft of fit out contracts still to be awarded the interior fit out sector should
remain strong in 2008. It is 2009 where the problems perhaps lie.
However, any down turn in the take up of new office space could be off-set by an
increase in re-stack work as occupiers decide to remain in existing space that bit
longer, and with a very good deal from the landlord.
Andy King is Managing Director of Metropolis Property Research and a Director of
CityOffices.net
For further information on Metropolis Movers research and City Offices.net research
on central London and UK regional cities please visit
www.metroinfo.co.uk
www.cityoffices.net
The information and analysis in this report have been rigorously checked and
is, as far as possible, correct at the time of going to press. Metropolis
Property Research Ltd can take no responsibility for any damage or loss
suffered as a result of any inadvertent inaccuracy within this report. The report
should not be relied upon as a basis for entering into any transactions without
seeking specific, qualified, professional advice. No part of the report should
be published, reproduced or referred to, without the prior approval of the
author. Any such reproduction should be credited.
11.02.08