The AA has u-turned on a planned prelet of a 60,000 sq ft headquarters building at Abstract Securities’ The Florence Building in Basingstoke a month after its chief executive left the company.
According to CoStar, market sources indicated that the AA, originally The Automobile Association, which has been one of Basingstoke’s key employers for more than 40 years, had decided to stay put at its long-term headquarters at Fanham House on Basing View campus, despite launching a requirement 12 months ago that was understood to be a response to the growing obsolescence of its offices.
In March 2016 Basingstoke and Deane Cabinet approved terms for the granting of a 999-year lease at the Basing View office campus site to Abstract Securities to enable the speculative development of a Grade A 60,000 sq ft office building.
The timescale for completion of the office, to be known as The Florence Building, is July 2018.
In April, CoStar revealed the AA had been identified as an interested party and terms had been agreed for it to lease the entire building.
As part of the transaction the AA negotiated terms to surrender the lease of its long-term home at Basing View – Fanum House – with the deal contingent on the AA completing the lease, taking occupation of The Florence Building and undertaking the demolition of all structures on site.
Quoting rents at the Florence Building are around £26.50 per sq ft.
Fanum House is let to the AA Services on a 99-year lease from April 1974 and has 56 years unexpired. The site would have remained within the council’s direct control and “hence capable of generating a ground rent income or a capital receipt”.
Market sources suggested the AA’s volte-face followed the recent replacement of the group’s executive chairman, who had been driving the relocation.