Bilfinger GVA’s latest office take-up review of the nine biggest regional cities showed that both Manchester and Liverpool topped their five-year quarterly averages in the fourth quarter of last year, with Manchester also achieving the highest headline rent.
The property consultancy’s ‘Big Nine: Quarterly review of the regional office occupier markets’ report analyses regional city centre and out-of-town office activity in the big nine cities outside of London.
Manchester’s five-year quarterly average is 250,408 sq ft for the city centre, and in Q4 of 2015 take-up was recorded as at 259,632 sq ft. In Liverpool, the average is 76,960 sq ft, and the total achieved between October and December was 113,216 sq ft. It was the first time in over a decade that Liverpool recorded more than 100,000 sq ft of lettings in two consecutive quarters.
Significant deals in Q4 for Liverpool included an 11,100 sq ft letting to Mann Island Finance at Standard Life’s No 5 St Paul’s Square and an 11,800 sq ft deal to Inenco at the Corn Exchange.
Manchester deals featured in the top five for the quarter, both in the city centre and out-of-town categories. Addleshaw Goddard’s 56,000 sq ft lease at Argent’s One St Peter’s Square was in the top five biggest city deals, while Stockport Homes’ 43,500 sq ft headquarters in Edward Street, Stockport, was in the top three out-of-town.
Manchester topped the list of rents at £34/sq ft, while Liverpool reached £21/sq ft.
Manchester and Birmingham both claimed the lowest yields at 4.75%.
The Q4 figures do not include the 80,000 sq ft Freshfields deal at English Cities Fund’s One New Bailey which will fall into the first quarter of this year.
Chris Cheap, senior director and head of offices at Bilfinger GVA in the North West, said: “Regional occupier office take-up activity is reaching a peak, with Manchester’s annual city centre take-up close to record levels and with the highest five-year quarterly average – the city continues to lead the way. The sheer number of transactions in 2015 is testament to the depth of the market place.
“Supply of prime space remains extremely tight across the nine cities with an average just short of a years’ availability based on past take-up rates. This is none more so apparent than in central Manchester where there is just six months’ supply of built and available prime stock and while there is a healthy development pipeline, occupiers with short time horizons really need to be taking action.”