Pandemic slows sales at York Hudson Quarter but interest remains strong

Practical completion of the scheme is due next March and the firm said it remains on budget.

Palace Capital is redeveloping a two-acre site that is a minute’s walk from York railway station within the city walls.

It will include 127 flats and 39,500 sq ft of Grade-A office space, located in four buildings around a landscaped central courtyard.

The scheme will also include a new landscaped link from the train station, opposite the site, through to Toft Green and then onto Micklegate. The new office building will be the first of its kind of this size to be built speculatively in York City Centre for more than 10 years.

The firm said sales have been hit by the Government lockdown, which closed its show apartment for four months from March to July and has now effectively closed it again until at least early December, except by appointment.

During this time, it has actively targeted overseas buyers through social media, particularly in the Middle East and Far East, where interest has been strong, "given the quality of the product".

Due to the impact of Covid-19, it said sales have slowed and this will have an impact on its ability to reinvest the proceeds during the early part of its next financial year, which was the original plan.

However, Palace Capital said it is confident that post lockdown and approaching completion of the high quality scheme, potential sales will accelerate.

4,500 sq ft of the office space has been pre-let to the listed legal and professional services firm Knights, on a 10-year lease at a record rent for York, which will commence when the building is completed in March 2021.

It also reported considerable interest in HQ, the self-contained 35,000 sq ft office building at the site. It said that the development is extremely well positioned to be abeneficiary of the post pandemic environment as York is only 105 minutes from London by a non-stop train service and HQ is within a two minute walk from the station.