The Ruskin Square development next to East Croydon station has landed a major coup after HM Revenue and Customs confirmed it would be taking all of the first 184,000 sq ft office block.
More than 2,500 civil servants are set to be employed in the nine-storey One Ruskin Square building, which was designed by ShedKM and is currently being delivered by Stanhope and Schroders’ Croydon Gateway Limited Partnership
As well as a 25-year lease on the first office block, which was marketed at a market-leading £35 per sq ft, HMRC has also agreed an option to take a similar amount of office space being earmarked as part of the mixed use scheme on the nine-acre site.
Steven Boyd, HMRC estates director, said: “The agreement at Ruskin Square marks a significant commitment to Croydon and is the beginning of a process which will see around 2,500 staff come together in state-of-the-art facilities in a strategic, fit-for-purpose location.
“This will make HMRC an important contributor to the economy and to communities in and around Croydon.”
The Croydon deal is a trailblazer for HMRC plans to set up 13 regional centres, having announced plans to close 137 local tax offices.
“The Croydon Regional Centre is the first of a series of new HMRC facilities that will support our transformation,” added Mr Boyd.
“We are planning to secure similar properties in other major cities across the UK over the next few years.
“We will fit these out to a high standard to provide the quality, digital working environments that our staff need, and from which we will be able to provide improved customer services to the taxpayer.”
The building should be completed to allow HMRC to begin fitting it out in November this year with a view to staff moving into the building next summer.
David Camp, chief executive of Stanhope, said: “HMRC’s decision to locate one of its major new office hubs at Ruskin Square in Croydon will be a further vote of confidence in the regeneration and revival of Croydon and Stanhope and Schroders’ creation of an attractive and vibrant destination and sense of arrival at East Croydon station.
“The first office block is already underway, the first phase of housing is nearing completion and, with the opening of Boxpark and detailed planning permission for a second office block, Ruskin Square will deliver the sort of commercial, housing and leisure development that Croydon really needs.”
James Lass, fund manager of Schroder UK Real Estate Fund, said the letting was validation of a strategy to build the offices on a speculative basis.
“We are delighted to have secured a tenant of the highest quality that will further enhance the strong underlying fundamentals of our portfolio,” he said.
“Ruskin Square will be a thriving new community for people to live, work and play at the node of this increasingly desirable London borough.”
The first phase of housing on the site, being delivered in conjunction with Places for People, is nearing completion, and follows the opening of Platform Ruskin Square – linking a new bridge at East Croydon station with the town centre – towards the end of 2013.
Stanhope and Schroders have outline consent for 2.5m sq ft of development at the 9-acre Ruskin Square site, including five Grade A office buildings of between seven and 15 storeys, providing 1.25million sq ft of accomodation, 625 homes and 100,000 sq ft of retail, cafes and restaurants.
Savills and JLL advised Stanhope and Schroders; JLL is advising HMRC.
The development has been welcomed by agents in Croydon. Holly Purvis, associate of Stiles Harold Williams, said: “HMRC choosing Croydon as its expansion hub illustrates what we in Croydon have been saying for years – with the right product occupiers will take space.
“Croydon offers fantastic overall occupier costs of sub £45.00 per sq ft in an office market which may be tightening due to Brexit.
“Ruskin Square is transforming Croydon and with the advent of Westfield the possibilities are endless.
“We are now in the fortunate position of needing more Grade A office space and will be watching the activity around Building Two with interest.”
Councillor Mark Watson, cabinet member for economy and jobs at Croydon Council, also welcomed the HMRC’s decision to set up a superhub at Ruskin Square.
“Croydon’s skyline is changing almost daily, and each new office block or apartment building will bring with it the jobs and homes that breathe new life into the heart of the town,” said Councillor Watson.
“This is coupled with enormous transformation that the redevelopment of the Whitgift Centre will bring with it, and the new cultural opportunities that will come from the council’s £30million regeneration of Fairfield Halls.”
Partner of Stiles Harold Williams and a specialist in the local office market: “The HMRC letting of Ruskin Square is very significant being the largest office letting in the town for a generation and fantastic news for the town. This fully endorses Schroders/Stanhope’s decision to develop the scheme speculatively and plays a major role in the regeneration of the town centre.”