With the landlord seeking a 55% increase in rent (based on a headline rent), J.P. Morgan Cazenove instructed McCalmont-Woods to negotiate two rent reviews on its behalf at its Docklands offices.
With the landlord seeking a 55% increase in rent (based on a headline rent), J.P. Morgan Cazenove instructed McCalmont-Woods to negotiate two rent reviews on its behalf at its Docklands offices.
By way of mitigating any increase in rent payable from the relevant review dates, McCalmont-Woods submitted a Calderbank offer and prepared a Statement of Agreed Facts and Statement of Evidence as a prelude to a full-blown Arbitration.
McCalmont-Woods successfully rebutted the landlord’s argument, settling the new rent at a modest 4.5% uplift, saving the tenant close to £1M in rent over the remainder of its lease term(s).
JP Morgan Cazenove occupied 16,000 sq ft business recovery offices and date centre space on the 3rd floor at 1 Exchange Tower, E14 in London’s Docklands. The 16 storey office tower at 1 & 2 Harbour Exchange was acquired by Hammerson in 1999 for £77m and subsequently sold onto MGPA Europe Fund III in September 2010 for £134.6m – an 8.1% yield. The building comprised 485,000 sq ft office space let to a range of tenants. The new landlord, MGP Harbour Exchange II S.a.r.l. sought to increase the annual rent payable under JPMC’s leases as at the 29th September 2009 review date, from £21.00 per sq ft to a highly optimistic headline rent of £32.50 per sq ft.
McCalmont-Woods was instructed by JP Morgan Cazenove to handle the upward only rent review negotiations on its behalf and mitigate any increase in rent payable from the review date.
Settlement was reached by negotiation between the parties at a revised rent of £22.00 per sq ft with McCalmont-Woods achieving almost £1 million rental savings for JP Morgan Cazenove over the 5 year term remaining on its two leases expiring in March 2015.