The central Manchester office market produced a 68% increase in the third quarter to 447,800 sq ft of occupational deals, compared to the same three months last year, according to the Manchester Office Agents Forum.
Between July and September there were 78 deals in the city centre including eight transactions of more than 10,000 sq ft.
Agents expect a total for 2017 of around 1.3m sq ft, in line with 2016. The tally for the first nine months of 2017 was 936,000 sq ft.
The largest letting in Q3 was 77,400 sq ft to the Department for Work & Pensions at Deutsche Asset Management’s Two St Peter’s Square. Other key transactions include the Parliamentary Health Service Ombudsman taking 32,000 sq ft at Hermes’ Citygate, PwC committing to an extra 25,197 sq ft at Allied London’s No1 Spinningfields, currently being sold to Schroders, and Clyde & Co taking 69,000 sq ft at the Royal Exchange, owned by Hines.
Mark Baldwin, associate director at GVA, said: “Once again, we are continuing to see increasing levels of demand in Manchester city centre from both expanding existing occupiers and inward investors. This is evident in the full-size range of deals being transacted and more importantly with many sizable lettings over 10,000 sq ft. Noteworthy deals to DWP and WeWork [44,000 sq ft at One St Peter’s Square in September] give a significant indication of an ongoing confidence in the market.
“Moreover, there are a still number of impending larger transactions in the pipeline which suggests 2017 will be another positive year for the city centre office market.”
South Manchester has also experienced a successful quarter with 140,531 sq ft let, up 29% on the same period last year. To date this has provided a running total of 472,263 sq ft of deals during 2017, a 45% increase on last year.
The largest letting was to Assetz Capital who took 14,687 sq ft at Manchester Green. Biz Space purchased 21,000 sq ft at Cheadle Place.
MOAF said that although stock is quickly diminishing there are were number of deals still to fall in by year end. It is anticipated that South Manchester’s 2017 take-up will be the highest since 2012.
The combined Salford Quays and Old Trafford take-up figure was 112,410 sq ft, a 25% increase on 2016, with Kellogg’s acquiring 48,000 sq ft at Orange Tower. According to MOAF the supply of Grade A office space in Salford Quays has become very limited.
Jonathan Cook of CBRE said: “The running total for 2017’s out-of-town office markets are very encouraging. There are already a number of deals going into Q4 that have yet to complete and this coupled with the quantity of existing requirements in the marketplace, take-up for the remainder of 2017 should continue to be very strong.”
Formed in 2009, MOAF members include, JLL, CBRE, Colliers International, Canning O’Neill, Cushman & Wakefield, Edwards & Co, GVA, Hallams, Knight Frank, LSH, Matthews & Goodman, OBI Property, Savills, Sixteen Real Estate, TSG Property Consultants, WHR and BE Group.