The new lease that Nomura is expected to sign on a 525,000 sq ft., City of London office property named Watermark Place sets never before seen terms in the London City office sector.

The bank has been able to negotiate a 70-month free rent period on a 20- year lease with owners Oxford Properties (a joint venture between UBS and a Canadian pension fund). The rent payable after the free rent period is £40 ($65) per square foot.

No further details of possible future rent step-ups or lease extension options were available.

Barclays Capital analysts said that the terms are indicative of the current weakness of the London City office market.

“We expect the Nomura lease to be the new benchmark for leases in the immediate future, although we believe that not many tenant requirements of this size are likely to be in the market for some time to come,” analysts said.

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