Response to Jersey Action Group's Facebook post - 1 Sep 2018 .
SoJDC's Jersey Finance Centre is now looking to fill unlet space with retailers, now the market for office space has declined".
Disappointingly but not surprisingly, more Fake News has been released by the Jersey Action Group (JAG) this week and to gain wider circulation, JAG paid Facebook to sponsor the post.
1) JAG audaciously state “no longer a finance centre more of a retail park”
There are two ground floor areas in IFC 5 that are currently approved for restaurant use totalling 2,621 sq.ft. (3.8% of the lettable area of the building). One of those units (1,315 sq.ft.) is proposed to be occupied by a business that will sell coffee & sandwiches as well as a retail product. This is not a wholesale change of the remaining space in the building to retail as misleadingly implied by JAG.
Jersey Development Company (JDC) introduced food and beverage use to part of the ground floor of IFC 5 in response to concerns that the IFC buildings would not have enough vibrancy at the ground floor level and, with these units located near to the newly created Trenton Square, it made perfect sense to change the use from office (this was approved in July 2017). These units were always intended to be a café / sandwich bar style of operator as the building does not have the heavy extract fans required for full cooking facilities. A restaurant is planned for IFC 6 where such extracts are within the current approved plans.
2) JAG’s comment, “And both buildings are still only partially let. There has been talk of selling the head leases, but no investor would take a partially let building at full price”.
IFC 1 is currently 88% let and will shortly be 100% let. The building was put on the market for sale in May this year and completion is expected in the near future.
IFC 5 which was only completed three week’s ago is currently 56% let with Heads of Terms signed on a further 30%, leaving just 14% available.
This demonstrates that i) there is demand for Super Prime Grade A office space and ii) JDC is delivering the right product as its building are rapidly approaching being fully let.
3) And finally, JAG’s comment regarding the market for office space has declined is also inaccurate;
2017 was a very strong year in terms of demand and take up, with more than 200,000 sq.ft. of space being let/pre-let, an increase from 160,000 sq.ft. in 2016 and well above the five year average of 152,000 sq.ft. p.a. This coincided with a number of high profile developments starting / reaching completion in late 2016 and early 2017, this included IFC 1, Gaspe House, 27 Esplanade and IFC 5 giving the opportunity for tenants occupying inferior space to relocate into modern and efficient offices.
There has continued to be strong occupier demand throughout 2018 and we are currently aware of 168,000 sq.ft. of potential requirements over the coming years.
Prime Grade A vacancy rates are low in St Helier (below 3% of the total office market) and rents in St Helier have risen steadily in recent years demonstrating confidence in the market generally both in terms of occupier commitment and end investors.