CoStar Group is reportedly in talks for a potential $3B transaction with Rupert Murdoch's News Corp. in CoStar's latest attempt to expand its residential platform through acquisitions. The two firms are discussing a deal for Move Inc., the online real estate business that owns several domains, including Realtor.com, Bloomberg reported Tuesday. News Corp. confirmed negotiations in a filing with the Securities and Exchange Commission on Tuesday, adding "there can be no assurance any transaction will result from these discussions." "News Corp actively assesses opportunities to maximize shareholder value, and discussions with CoStar Group are part of that ongoing effort," the statement says. "Any potential transaction would support News Corp’s strategy to optimize the value of its Digital Real Estate Services segment, while strengthening Realtor.com’s competitive position in the market." CoStar didn't respond to a request for comment. The news comes as Murdoch has explored a restructuring of media conglomerates News Corp. and Fox Corp., and as CoStar has searched for a major deal to grow its residential business. CoStar has missed out on two potential acquisitions over the past two years, in part due to federal scrutiny of its market share. In February 2021, CoreLogic rejected an acquisition offer with a $700M premium from CoStar to instead sell to private equity firms Stone Point Capital and Insight Partners. CoreLogic cited CoStar's stock volatility and the potential for antitrust litigation in an open letter addressed to CoStar CEO Andy Florance in March 2021, saying it would expose "CoreLogic shareholders to unnecessary delay and risk." That came after the Federal Trade Commission authorized a lawsuit against CoStar in 2020 over its proposed acquisition of real estate data firm RentPath. The firm, which owns Rent.com andApartmentGuide.com, was later acquired by Redfin for $608M. Last year, CoStar faced some skepticism from analysts about its pivot to the residential business. CoStar has acquired Homesnap andHomes.com over the past two years, but analysts questioned the wisdom of investing hundreds of millions in the platform, as Florance has committed to doing. Florance suggested in a third-quarter earnings call on Oct. 25 that the cooling residential market may be a tailwind for CoStar's residential business, according to a transcript from Seeking Alpha. CoStar's stock was trading more than 2% lower than the previous day at market open on Wednesday, falling below $77 per share. News Corp.'s stock price was up 7.5% after the first hour of trading Wednesday. Contact Jacob Wallace at jacob.wallace@bisnow.com

One of the most compelling claims about working from home — that it is more productive than working from the office — has been challenged by new data from the UK's official statistics body. The UK’s Office for National Statistics has had a second look at the productivity data for the coronavirus pandemic of 2020 and 2021, and decided that far from showing rapidly accelerating output per hour, the figures show the reverse. The rethink involves a data set based on growth in average output per hours worked. The calculation is, in theory, simple: You divide gross domestic product by the number of hours worked, then calculate how much this changes year-on-year. It is a standard measure used by government statisticians throughout the world. However, UK statisticians came to some erroneous conclusions. The early view was that working from home during the pandemic appeared to have helped output per hour worked to grow fast, rising by 5% during the pandemic years 2020-21. What in fact happened was that the  UK's average output per hour growth rate fell by 0.3% over the coronavirus period, lagging behind growth in Canada (0.8%), Germany (0.9%), Italy (0.9%) and the USA (2.3%). The revised data showed that far from working from home during the pandemic-improving productivity, it hampered it. The UK’s output per hour worked showed the second slowest growth of the G7 countries in 2021, excluding Japan where there isn’t enough data. The poor UK performance followed a 1.2% increase in output per hour growth in 2020, the fourth-highest growth rate among the G7 nations that year, according to the component method. That showed the UK was improving productivity well until work-from-home became prevalent, and it hasn’t recovered since. Almost all advanced economies took a hit to productivity during the pandemic, although the UK did worse than the rest. Average output per worker growth rates over the coronavirus pandemic period were negative for all G7 countries except Canada and the United States. Average output per worker for the G7 nations (excluding Japan and the UK) was 16% above the UK level in 2021. Contact David Thame at david.thame@bisnow.com

The 68,000-Square-Foot Office Is Part of Larger Southbank Complex with Two Residential Towers JTRE London, the UK branch of European developer JTRE, has fully let its One Triptych Place office on London's Southbank after three companies took space. An undisclosed pharmaceuticals company, understood to be one of the largest in the world, has put pen to paper to occupy five floors, or 30,000 square feet, at the Bankside site. It is joined by television communications company Digital UK, which has taken 8,000 square feet, and US architectural firm Corgan. The latter has agreed a let spanning 4,800 square feet. The deals mean that the 68,000 square feet of office space at One Triptych Place is fully let after launching in March 2022. The other tenants are publishing house, the Quarto Group, which signed a 12-year lease for all of the 9,000-square-foot second floor in August 2022. Indoor bouldering company the Font is also housed in the building, as well as independent coffee company 92 Degrees, in the reception area. JTRE London joins its tenants in a 4,000-square-foot, first floor office as it opens a new UK head office. The Triptych Bankside development is a short walk from London Bridge station and is next to Tate Modern art gallery, Shakespeare's Globe theatre, Borough Market and the Millennium Bridge. Designed by Squire & Partners, One Triptych Place forms part of a £450 million mixed-use development. The scheme comprises three towers, with 169 luxury apartments in two blocks, offices in a third, plus 14,800 square feet of retail and 14,000 square feet of cultural space. Developed to meet a BREEAM rating of Excellent, the office building at Triptych Bankside comprises nine open plan floors, with full height glazing and terraces on the top three floors. Tenants will have access to concierge services, a café, cycle storage, showers and changing rooms. At ground level there will be an exercise studio, boutique retailers and a cultural space, alongside landscaped gardens and public realm. Nigel Fleming, sales and marketing director of JTRE London, said in a statement: "The signing of one of the biggest global pharmaceutical companies is testament to the design, location and quality of development at Triptych Bankside. From exceptional prime office space that meets the rigorous demands of today’s occupiers, to exciting retail and leisure offerings, we are delivering a world-class mixed-use offering that will create an enduring legacy on the vibrant Southbank. The Triptych Bankside estate is one of London’s successful projects in recent years, and we are delighted to now also call it home for our new JTRE London head office." JTRE secured a £177 million construction loan with ICG Real Estate for the flagship development in June 2020, marking the developer's first entrance to the UK market. The site is the former National Grid office and was bought from Delancey's DV4 client fund in 2018 with planning consent for 163 apartments and 87,081 square feet of offices, 9,892 square feet of shops and a 16,609-square-foot cultural facility space. BH2 and [...]

17.8-Metre Tower in Shoreditch Has Space for 506 Desks and Is London's Tallest Timber Building TOG, the flexible workspace provider owned by Blackstone and Brockton Everlast, has opened central London's tallest mass-timber tower in Shoreditch, with online grocery retailer Ocado already in situ. The Black & White Building, which is the firm's first property to be "built up from the ground", is a 17.8-metre office block, covering 38,315 square feet, which has been constructed using renewable materials and "highly innovative construction methods" for a cost of around £17 million. CoStar News understands that the building is already 50% let, with Ocado Technology, part of grocery company Ocado Group, taking space on the third floor of the seven-floor building. BVN Architects is also located at the property, which is predicted to be full in six to eight weeks. TOG bought 74 Rivington Street in 2013. On the site was an 11,000-square-foot building that was painted black and white, giving the development its name. The space has been expanded and rebuilt, using cross-laminated timber and laminated veneer lumber, creating a 506-desk flexible work space, with 28 offices of varying sizes. Six meeting rooms, two lounge areas and break-out spaces also feature in the building, which will have a roof terrace and storage space for 94 bikes. TOG, which is now part of The Office Group following a merger of TOG and peer Fora in September 2022, says the timber used in the building reduces the embodied carbon by 37% compared with a concrete structure of the same size. It also claims the renewable materials are recyclable and generate less waste than common building materials like iron, steel and cement. The Black and White Building is targeting a BREEAM Excellent rating. The Office Group CEO Enrico Sanna in a statement said the building represented "the blueprint for our future workspaces" and would encourage others to rethink their construction methods. "As businesses of all sizes are increasingly considering their impact on the planet, we have an important role to play in leading by example and helping to transform the urban fabric of the city, as well as helping our members to deliver their own sustainability credentials. "Partnering with Waugh Thistleton Architects has brought our aligned sustainability vision to life by developing a building that offers long-term, innovative and sustainable solutions." The Black and White Building is the Office Group's 14th in the City and Shoreditch area, and sits directly opposite TOG's 81 Rivington Street property. President of The Office Group and TOG co-founder Charlie Green said: "Rebuilding The Black & White Building has been our opportunity to show our very real commitment to driving positive change in the industry. "It’s about building as responsibly as possible, taking risks and learning as much as we can along the way. We very much hope that this building encourages others to develop commercial buildings with the environment at the core of their approach to construction." "The Black & White Building is TOG's first project which has seen [...]

Coworking Group Is Slashing 300 Jobs WeWork, the global flexible space provider, is cutting staff globally. The New York-based company said in a statement today (19 January) ahead of its upcoming earnings call that it plans to axe about 300 roles globally to cut costs as high inflation weighs on company spending on offices. WeWork said in a brief note that its preliminary numbers show the company made gains in revenue and adjusted earnings before interest, taxes, depreciation and amortisation through the final quarter of 2022, exceeding the guidance provided in its third quarter 2022 earnings call. But it said that in connection with its "portfolio optimisation" and in continuing to streamline operations, it is pursuing "headcount reductions" which will account for around 300 roles in its global workforce. This is understood to affect around 10% of its UK workforce. It employs 500 staff in the UK and operates 50 locations in London, four in Manchester and one in Cambridge and Birmingham. In November of last year, WeWork said it was closing 40 US underperforming shared office locations while at the same time seeking to take advantage of growing global demand for flexible workplaces in a bid to turn profitable. Fitch Ratings downgraded the group in December on concerns over the effect of the global economic slowdown on demand for offices. The downgrade was issued in the context of WeWork's tentative but continued move to profitability following a tumultuous few years with a failed first attempt at a public listing and the global lockdowns imposed during the pandemic. The job cuts come as it has signed to increase the space it occupies at 123 Buckingham Palace Road next to London Victoria station. The company will occupy the building’s fifth floor, comprising 30,000 square feet, in addition to its existing space on the second and fourth floor, which WeWork has operated since 2018. The group said the expansion, due to open later this year, will meet the "unwavering demand from companies, particularly enterprises with large workforces, who continue to seek class-A, flexible workplace solutions in well-connected locations across the capital". WeWork says that in 2022, 123 Buckingham Palace Road was the second most popular location for its All Access bookings, behind WeWork’s flagship location at 10 York Road, Waterloo. And over the past year, the company saw WeWork All Access bookings at 123 Buckingham Palace Road increase by 59%. The letting is its first new lease in the capital for four years. Peter Greenspan, global head of real estate, WeWork, said in a statement: “This expansion underscores the strong demand we’re experiencing from companies who are opting for commute-worthy workspaces that cater to employees’ shifting priorities, as they weigh up travel time with what they want to get out of their office visit. This is a strong indication of how workers are now thinking about the office – our most sought after locations are those within walking distance of major transport hubs, such as 123 Buckingham Palace Road, which is consistently [...]

Group Says £62.5 Million Price is a 25% Discount to Asking Price in June Darin Partners has bought 6 Duke Street, a multilet office and gallery in London's St James's for £62.5 million or a 4.27% net initial yield. In a LinkedIn post Darin, an investor on behalf of global private clients, said the price paid reflects a discount of 25% from its June 2022 asking price. The building has been bought from Abrdn. It comprises 27,300 square feet of offices and 7,700 square feet of gallery space. The offices are multilet with the 4,400-square-foot fourth floor vacant. Darin Partners chief executive Dave Bell posted on LinkedIn that the building had been bought for long-term capital appreciation, and it was now focused on driving value, "through active asset management". Darin was advised by RX London; CBRE advised Abrdn.  

Deal Signed With Israeli Entrepreneur Hagag-Gaya to Operate Holborn Offices Flexible workspace group InfinitSpace has signed for a second London location, taking 24,000 square feet of offices at Kingsbourne House in Holborn, CoStar News can reveal. The company was founded by Wybo Wijnbergen, the former European managing director of US coworking group WeWork, and his brother, tech entrepreneur Wilco Wijnbergen. It partners with landlords to redevelop traditional office space by creating and operating white-label flexible workspace brands. The new space will be operated under the "Beyond" Brand. The company launched its first flexible workspace in London's Aldgate Tower in March 2022. The Holborn office at 229-231 High Holborn is owned by Hagag-Gaya, a company founded by Eido Hagag, an Israeli entrepreneur and co-founder of the publicly traded Hagag Group, one of Israel's leading property developers. Hagag-Gaya has entered a partnership with InfinitSpace to manage all of the seven-floor building. InfinitSpace created a new flexible workspace totalling 24,000 square feet, which opened on 9 January. It has coworking and private office memberships, with flexible terms and suitable for individuals up to large teams of 100 people. There are fully-equipped meeting rooms and event space for larger groups, as well as private floors. InfinitSpace says there is ultra-fast WiFi, IT support, a community team, and a workspace app. Additional services include premium coffee, breakout spaces, phone booths, inspiring events, an on-site community team, bespoke self-contained floors, and shower and changing facilities. Kingsbourne House is located directly next to Holborn underground station and within walking distance of Covent Garden, Soho and Bloomsbury. Wybo Wijnbergen, CEO of InfinitSpace, said in a statement: “We are delighted to unveil our second London location – and what a location it is. Kingsbourne House is an incredible building in the heart of the city. And amidst the buzz of the capital, we have a bright, modern flexible workspace that will equip its tenants with all the tools, spaces and facilities required to make amazing things happen. “Since the start of the pandemic, flexible working has become the norm for many businesses. This means they need flexible spaces to work in – ones that can be accessed around the clock, are optimised with technology, and provide an exceptional experience to inspire people to travel to their place of work. We are human-centric; everything we do is tailored to empowering human endeavour. And we’re delighted to partner with Eido Hagag and his team for this hugely exciting project."

London Developer Says Offices and Retail Developments Have Been Letting Up Strongly GPE, the central London focused developer and investor, said strong leasing had continued into 2023 as it published an update for the quarter to 31 December 2022. Toby Courtauld, chief executive, said a strong quarter has seen it secure its largest prelet at 2 Aldermanbury Square with law firm Clifford Chance, while it had made substantial progress leasing the remainder of its retail space at its Hanover Square and 70-88 Oxford Street developments. Courtauld added that robust demand for the best spaces in central London meant the group was confident in the "attractions of our highly sustainable, flexible, tech-enabled spaces in a market where high quality product is increasingly scarce". GPE signed 29 new leases and renewals generating annual rent of £34.3 million (its share: £33.1 million), with market lettings on average 2.1% ahead of March 2022 estimated rental value. Alongside the 321,000-square-foot 2 Aldermanbury Square prelet on a 20-year term there are six fitted and two fully managed leases signed, for an average £196 per square feet on the fully managed space, and 7.1% ahead of March 2022 estimated rental value. There were 11 new retail leases securing £4.6 million of rent with market lettings 12.6% below March 2022 ERV, including a large letting to Polish fashion chain Reserved at 70-88 Oxford Street, W1. The total space covered by new lettings, reviews and renewals was 438,000 square feet. Another £2 million of rent is under offer, with market lettings 20.1% ahead of March 2022 ERV. Ninety-nine percent of rent charged was collected within seven working days for the month of January. GPE expects to practically complete 50 Finsbury Square, EC2 in the coming week, with the lease to Inmarsat, and sale of the building, completing shortly afterwards. In total, GPE has now signed 629,100 square feet of new lettings since the start of the financial year (1 April 2022), generating a combined annual rent of £50.9 million.

Chinese Social Media Giant Taking 140,000 Square Feet at Topland and Beltane Building Topland Group and Beltane Asset Management have secured social media platform TikTok Information Technologies for a major London office prelet at their Verdant development in Farringdon. Comprising 140,000 square feet of offices, the scheme is in the heart of the "Cultural Mile" and connects 150 Aldersgate Street and 3-4 Bartholomew Place in Farringdon. It is due for completion in the third quarter of 2024. TikTok is owned by ByteDance, a China-founded technology company. Mark Kingston, managing director of Topland, said in a statement: “We are delighted to have transacted with this growing, cutting-edge brand that was seeking exceptional modern office space in the heart of London. “Our decision to build speculatively demonstrates our confidence in the London office market, which has now been borne out by signing such a quality client. Verdant provides truly sustainable next generation office space which appeals to a wide range of occupiers.” Sol Zakay, Chairman and CEO, added: “Our decision to proceed with numerous developments is paying dividends as proven by this pre-let and our pre-let in Brighton of the new Maldron Hotel to Dalata. “We are also excited about our office development on Upper Street, London, and our build to rent scheme at Paradise Circus in Birmingham.” Verdant has a low embodied carbon footprint achieved by reusing approximately 80% of the existing structure, natural ventilation throughout and a bespoke biophilic design integrated into the architecture. It has green roofs, terraces on all floors, hard and soft landscaping and external courtyards. Communal facilities incorporated include a ground floor café and co-working area and more than 250 cycle spaces. The development has entrances on both Bartholomew Close and Aldersgate Street and is located within 100 yards of the new Farringdon East Elizabeth line station and TikTok’s nearby Kaleidoscope building. The development will be a boost for London office markets wary of announcements in recent times by major tech players about the need to scale back their offices to manage costs. Provisional figures from JLL supplied to CoStar News do show a clear drop in take-up by the TMT sector (technology, media and telecommunications). It expects TMT to have accounted for 17% of the market, or 1.6557 million square feet, in 2022, with banking and finance, and professional services, having stepped into the breach in an otherwise strong year. The figure for TMT take-up is the lowest percentage-wise in London in the last 10 years, apart from the 15% in 2019. The figure is down on the 10-year average of 23% and dramatically down on 2021 when 29% of all office take-up was accounted for by TMT. Helical let the whole of the 88,500-square-foot Kaleidoscope building above the Farringdon Elizabeth line Station to TikTok Information Technologies UK for its UK headquarters, in March 2021. The lease was for a 15-year term with a tenant option to break at year 10, with an undisclosed market rent-free period granted. The building has subsequently sold to Hong Kong's ChinaChem. In [...]