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Property
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Brewery to transform 18th Century Orange Bastion
around 20% reduction in rental rates, so launched in June on two floors of the just-
another phase of WTC as this would attract businesses from overseas as well as encouraging local companies to expand, which in turn helps Gibraltar’s economy.”
Boosting economy
A report late last year by independent international economic consultancy, Nairne, found WTC contributed £65m annually to the Rock’s economy of which £30m pa goes to the government in taxes from the building’s occupants.
Lamplough admits: “We are very aware that we are competing on a world stage with international companies considering offices in Malta, Eastern Europe and even further afield. A further - possibly larger - phase could include more services for tenants.” The present WTC has an on-site nursery, Happy Feet, which caters for 31 children and a waiting list, and Lamplough suggests there is a demand for on-site hairdressers, more choice of healthy eating and courier services.
“A massive issue in Gibraltar is Section 69 of the Landlord & Tenant Act that allows landlords to charge a premium of up to two years rent as a condition if tenants want to assign a lease after, say, 5 of 21 years contract,” Howard reveals. Initially affecting high street retail units, the premium subsequently was extended to offices, but there’s been “big push-back from tenants, so that leases or side letters usually now limit the premium to 3-6 months.” However, many lengthier property leases contain the offending clause limiting occupiers’ ability to move!
NatWest International is releasing 275 m2 of a Coral Road building and relocating to its Line Wall Road offices where it is taking 95 m2 more space and investing £1.1m in technology developments there. The vacated building is to be gutted to make way for a 120-bedroom, Indigo Hotel, following launch in July of a similar-sized Holiday Inn Express in nearby Devil’s Tower Road.
AKS group is starting a year-long conversion of the 18th Century-built Orange Bastion off Irish Town to create Gibraltar’s first real ale, craft beer and lager brewery with a capacity of 2,800 pints a day that will utilise one of four 45m-long vaults. This will be the centre point of a £3.5m project within a 2,000 m2 sunken site, which creates a communal open and covered area expected to house 14 catering units. These will include an extensive brewery pub, a gin bar and distillery, high-class restaurants and street style food stalls open all year round.
typically they are now +/– £280m2.” Hassans’ Howard doesn’t believe the new WTC and Midtown buildings are creating an office over supply. “No: it’s excit- ing times now that those new developments are coming on stream as the first modern purpose-built office centres for a good number of years – the breadth and scope of
Grade A offices is better than it’s ever been.” The growing FinTech community in Gibraltar, attracted by the jurisdiction’s world-leading regulation of blockchain and (soon) also tokens (ICOs) offerings, requires tech-efficient office spaces, often initially for 4-5 people to establish a foothold and go through the licensing process before
expanding.
”This to me presents an opportunity for landlords, with space becoming available by virtue of companies moving into the big new offices, to offer shorter term license arrangements or rental rather than full tenan- cies, but with upgraded facilities beyond a simple lick of paint”, Howard suggests. Usually landlords look to let larger unit spaces and on minimum 3-year leases.
Flexibility needed
Howard reports: “Some of these young start- ups are nervous about committing to that length of term at the outset, so I think we need to have a more flexible offering. The feedback we get is that these fledgling businesses are struggling to find smaller short term premises – they have not been able to slot in anywhere.”
For start-ups and firms wanting temporary extra space, Regus, the serviced offices supplier with 11,345 m2 at WTC, is 80% occupied by more than 60 companies.
Europort also plans a FinTech-inspired co-working space of 300 m2 from mid-2019. A similar venture, The WorkLab W1, was
completed West One mixed-use 11-storey block.
“More and more people, like freelancers, need a desk that can be rented on a daily or monthly basis, with all services - conference rooms, chill out zones, secretarial, coffee facilities,” says developer Evgeny Cherepakhov, chairman of Bentley Group Companies. “People don’t want to spend money any more, and have headaches with facilities and services like telephones, rates and so on – this is an advanced concept, where we believe the future is, so we are providing 76 desks.”
He’s on the verge of starting work on an adjacent £80m EuroCity mixed-use project that in three blocks combines 366 apartments
– with over 200 already reserved – and some 3,000 m2 of commercial space, half being offices. “They will be ready in 4-5 years and I could sell everything today, but to be honest, at this stage I prefer to rent and it’s too early for that,” declares Cherepakhov. “I know the demand is here; we already have a waiting list.”
Coming on stream in 2021 is Liberty, a further 11,000 m2 office space at Midtown, where piling has begun and is indicative of confidence in commercial property demand. Reportedly, there has been strong interest in the project from existing business and companies new to Gibraltar.
There’s speculation too that a larger WTC 2 will appear on land next to the existing building and presently occupied by Bayside School that will relocate in September 2019.
At the WTC Gibraltar opening last February, Fairhomes chairman, Gregory Butcher revealed that such was demand for quality space “my only regret is not making the building bigger”. Lamplough is coy, stating: “We see there is a real need for
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