The supermarket giant is close to completing a 4,400 sq ft letting at English Cities Fund’s recently completed office block in Salford.
Sainsbury’s is to sign a 25-year lease with a break option after 10 years, to occupy part of the ground floor at the 185,000 sq ft Two New Bailey Square.
The building’s ground floor units had been earmarked for food and beverage operators, however, due to the impact of the pandemic on the hospitality industry, such a letting was deemed unlikely in the current climate, according to a report by Salford City Council.
The Sainsbury’s letting “does not preclude F&B operators taking space on the ground floor in future, but the prevailing market conditions mitigate against this use at present”, the report said.
Sainsbury’s joins occupiers BLM, a legal services provider that agreed to lease 71,000 sq ft in November 2019, and fellow law firm Eversheds Sutherland, which occupies 50,000 sq ft.
Salford City Council and English Cities Fund, a joint venture between Muse Developments, Legal & General, and Homes England, declined to comment on the latest deal.
Contractor Bowmer + Kirkland finished construction of the 11-storey Two New Bailey, designed by architect Allford Hall Monaghan Morris, earlier this month.
Pension fund manager Aviva Investors forward-funded the development of the office building at a value of £113m. The purchase was undertaken on behalf of Lime Property Fund – part of Aviva – in March 2018 as part of the fund’s continued investment into high quality, long income real estate in the UK, it said at the time.
Phil Mayall, regional director at English Cities Fund, said: “The fact that we’ve already attracted tenants of such a high calibre, well in advance of the building being complete, speaks volumes of New Bailey’s positive reputation in the office market.
“Working habits have shifted over the course of this year, but there is still an appetite for companies to have their own central office base and Two New Bailey Square provides spaces where occupiers can welcome clients with pride.”
Following the BT deal, Place North West revealed that Warrington Council had agreed to forward fund the construction of Four New Bailey to the tune of £112m, taking ownership of the building once complete.