Prime office blocks are up for sale, and it’s crunch time for offices.

In the coming months, the appetite of investors for London office space will be more apparent. A number of large blocks in the capital have recently been listed for sale. Over the last couple of years, deals have been scarce as rising interest rates and uncertainty over working from home has pushed many would-be buyers away.

There are a few offices on the market, each valued at more than £300 million. Shell’s HQ is for sale at $£400 Million in the Southbank Place Development.

Almacantar is a London-based property developer who has been trying to sell One Southbank Place – Shell’s headquarters – for £400m. Nuveen, an investment company that invests in the pensions of American educators, has listed 70 St Mary Axe – better known as Can of Ham – for £320m.

Citypoint in the City is currently the most costly building up for sale. Brookfield, the Canadian owner of half of Canary Wharf Group wants offers of at least £500million.

If the price is reached, this would be the largest London office sale since Land Securities sold One New Street Square in January 2023 to a Hong Kong developer, Chinachem, for £350million.

Some, however, are skeptical of the £500-million asking price. One industry insider stated, “I haven’t spoken to anyone that thinks they will get anywhere near that.” Brookfield wants offers worth at least £500,000,000 for the Citypoint Office towe

Agents are reporting a lot of interest in the offices from buyers. According to CoStar, they were attracted by lower prices. London office values have fallen by an average of 19% from their peak in two years.

While values have been severely impacted, there’s a growing sense that they’re either at the bottom or very close. CoStar estimates London office values rose by 1 percent between the second quarter and third of this year.

Rents for the most eco-friendly, best offices are rising sharply, despite the fears of the “death” of the office following the pandemic. This is due to a lack of “grade A”, high-end buildings and the growing demand for them from businesses.

An executive from a property investment company said, “I believe the market is waking up to the fact that many of these offices have strong operational fundamentals.” Rents have been high and occupancy is also strong. “Yes, there is a headwind from work-from home, but it looks as though this has stabilised.”

Investors have been hit by a steep rise in financing costs in recent years, as a result of the dramatic increase in interest rates. In the City, there is a consensus that the Bank of England will continue to cut rates in the future, despite the fact that it has already done so this year.

Ed Bradley, CBRE’s head of central London investments, stated that “investment volumes were muted in 2024 but we are forecasting a significant increase in 2025.” “The UK economy is in a good place, with high inflation rates, high consumer confidence and GDP forecasts. “My slogan would be ‘2025 will be a year of deployment’.”

Investors are looking at office space again but it is not clear what they will pay. CoStar data indicates that the average discount on asking prices for deals closed this year was 15 percent.

“Do I think [the sellers] are going to get the price they quote?” The executive stated that the past performance of the last two years suggests otherwise, but at this stage it is all about finding the right price. It will be interesting where we end. “A test [of London’s office market] would be the best way to frame it.”

These deals, according to agents, are a sign of what is to come. More deals will likely be offered if these blocks are sold quickly at low prices. One said, “The market appears to be just a few trades away.” “What I meant by that was if two of these [sales] went well, you could see a material rating re-rating.”