Allen & Overy may have become the first magic circle firm to move south of the river when it is pushed out of its One New Change headquaters in 2006.
Landlord the Bank of England has announced plans to sell the site when the lease runs out. The firm has set up a subcommittee to look at new premises options, with favourites understood to include sites in Spitalfields, Canary Wharf, Paternoster Square and Bishopsgate. A couple of sites near London Bridge are also being considered, which could see the magic circle firm become the first to move south of the river.
The current 350,000sq ft site is understood to cost A&O only £8.75m a year. At a rent believed to be £25 per suare foot, the firm is paying a lot less than rival Clifford Chance, which pays £40 per square foot for its Aldersgate Street site. The move to Canary Wharf is believed to be saving Clifford Chance as much as 15 per cent on that rate (The Lawyer, 3 July)
A&O is looking for a bigger site, nearer 600,000sq ft, to accommodate growth. A likely rent increase in the region of £10 per square foot would see property costs hit £21m.
Chairman of the A&O committee, business services director Rodney Barker, says: “Cost has to be an issue, but it certainly isn’t the only issue. It’s very much how it works for our staff and our clients. You wouldn’t want to trade off that just against costs.
“We are very keen on keeping costs down, but what we are absolutely not going to do is just go for the cheapest posibility.”
Clifford Chance’s former site has been ruled out. Barker says the 505,000sq ft site is too small, and a partner adds:”The chances of going to Aldersgate Street are less than zero. We don’t go for sloppy seconds.”