© 2026 Arizent. All rights reserved.

ABS

Nomura’s Unprecedented Lease Could Set New Benchmark for U.K. Property Deals

Published Updated 1 Min Read

The new lease that Nomura is expected to sign on a 525,000 sq ft., City of London office property named Watermark Place sets never before seen terms in the London City office sector.

The bank has been able to negotiate a 70-month free rent period on a 20- year lease with owners Oxford Properties (a joint venture between UBS and a Canadian pension fund). The rent payable after the free rent period is £40 ($65) per square foot.

No further details of possible future rent step-ups or lease extension options were available.

Barclays Capital analysts said that the terms are indicative of the current weakness of the London City office market.

“We expect the Nomura lease to be the new benchmark for leases in the immediate future, although we believe that not many tenant requirements of this size are likely to be in the market for some time to come,” analysts said.

For reprint and licensing requests for this article, click here.

More From Asset Securitization Report

Share Deal Structures Could Carry Negative Implications for U.K. CMBS

The recent property acquisitions reported over the last two weeks are signs that the U.K. commercial property investment market may be headed towards revitalization. However, while these tentative signs are a credit positive for CMBS, the individual credits may be affected differently if “share deal” structures are used, Moody’s Investors Service analysts said. Traditionally, investors purchase […]

U.K. lease draft to have minimal impact on CMBS

In a consultative paper released last week, the Office of the Deputy Prime Minister (ODPM) addressed options for legislating against upward only rent review (UORR) clauses in commercial property leases. At this stage, it is not entirely clear how modified lease arrangements will affect CMBS structures, though market sources are confident that the impact, if […]

London office property market well insulated

Despite the downturn in the U.K. office property market, investors can still find attractive investment opportunities, said analysts at Fitch Ratings. Areas that have been of particular concern are the Canary Wharf and London city markets, which have seen weaker tenant demand and falling rental volumes as a result. Fitch believes that the recent negative […]

New York City Office Market Faces Challenges in its Recovery By Joan S. Biro, director, Scott Robinson, assistant director, and David Wyss, managing director and chief economist, Standard & Poor’s Ratings Services

The New York City office market is experiencing higher vacancy and reduced effective rents resulting from the terrorist attack on Sept. 11 and the weakened U.S. economy. While prices of New York City commercial real estate have so far generally held steady, it is expected that prices will soften as additional sublease space comes to […]