Oxford Street to see 1m sq ft of retail spaces converted to offices
Analysis from Savills found that conversions of former retail space to offices would account for 72% (960,000 sq ft) of new office space available on the street
London’s Oxford Street is set to see 1.32 million sq ft of new office schemes proposed for delivery in the next five years, in a move that has been called a “generational change” by Savills.
Analysis from Savills found that the extent of potential in the conversion of former retail space to offices would account for 72% (960,000 sq ft) of new office space available on the street.
The group said Oxford Street’s development pipeline is “hotly anticipated”, as live requirements for 100,000+ sq ft offices “have never been higher”, with Palantir, Conde Nast and Evercore in the market.
It added that this comes against a backdrop of strong occupier demand across the Central West End sub-markets surrounding Oxford Street, which has seen a 1.4% decrease to the vacancy rate since the end of 2021 to now stand at 5.1% compared to the overall West End vacancy rate of 6.1%.
Key schemes along Oxford Street include: Sirosa’s 163,000 sq ft at Emporium, Henrietta Place, the former House of Frasers, available from Q3 2024; Ramsbury & Capital Real Estate delivering 280,000 sq ft at the former Debenhams Store, 334 Oxford Street Q4 2024; Derwent London granted planning for 150,000 sq ft at Holden House 54-68 Oxford Street (exp, 2027); and 80,000 sq ft at a former Next store at The Ribbon, Wells Street, being delivered by M&G in H1 2024.
Andrew Wedderspoon, director in the West End office agency team at Savills, said: “The very best offices today not only offer cutting-edge design but also strong locations on account of connectivity and transport links and a proximity to amenities and leisure spaces. Oxford Street is already globally recognised as a leading retail and leisure destination and its location lies at the heart of Central London.
“While the area has been hard to imagine as a genuine office sub-market until now, the sheer volume of space available for conversion is a once in a generation moment to transform the street and attract those larger occupiers who may otherwise be pushed out of the West End due to a lack of opportunity.”
Sam Foyle, co-head of prime global retail at Savills, added: “High streets up and down the country are evolving to be far more mixed use and Oxford Street is no different. Where department and retail stores are no longer fit for purpose, there is an opportunity to repurpose shopping streets, to breathe new life into older buildings, bring in new users and drive up footfall that will benefit the retailers that continue to operate in the area successfully.
“It also creates new opportunities for retailers and leisure operators to pivot to meet new demand from the after work market that will increase with more office occupiers in the area. All of this creates greater vitality and an ever more appealing destination to visit – whether for work or play.”
