Manchester Office Sector Update - City Centre Totalled 306,492 sq.ft
New figures released on 16th April 2020 show that Manchester city centre office take-up in the first three months of this year (Q1) totalled 306,492 sq.ft across 58 deals. This represents the third consecutive year that Q1 activity has exceeded 300,000 sq.ft.
Major lettings were seen at schemes including Bruntwood SciTech’s new Circle Square development where a total of 67,348 sq.ft was let in four separate deals to Northcoders, HPE, Accenture and Hilti, who secured 42,559 sq.ft in the largest single Q1 transaction. Further highlights saw Sopra Steria and Marker Study take a combined total of 52,260 sq.ft at M&G’s Arndale Tower, which is now fully let; Fore Property’s Windmill Green secure flexible workspace operator, Hana, along with OneStream who signed up to a combined 36,677 sq.ft and Boultbee Brooks’ Core, who secured Bet 365 into 25,029 sq.ft of offices.
Occupier activity in the Salford Quays and Old Trafford market totalled 111,916 sq.ft of transactions across 19 separate deals, which was twice the level of activity for the same period of 2019. Five deals in this market were over 10,000 sq.ft and included HMCTS at Metro, Chep at Think Park and Bibby Financial and QA Consulting both taking space at The Anchorage. The largest transaction to complete was the 21,400 sq.ft letting to BES at Peel’s Adamson House.
In South Manchester, office take-up in the first quarter totalled 105,881 sq.ft transacted across 32 separate deals. This included two freehold sales: Connel Utilities purchased the 12,300 sq.ft Artemis House in Stockport and Place First acquired 123 Clarence Road in Longsight, comprising 20,387 sq.ft.
The survey noted that despite the continuing government restrictions, which have effectively put a temporary hold on activity, there has been very little fall-out in terms of occupier demand impacting future office transactions. The Forum cited that the robust fundamentals of Manchester’s city centre office market will continue to attract inward investment and more importantly stimulate growth within its indigenous SME community.
Office supply levels of both new-build and refurbished schemes have been carefully maintained to run alongside annual average take-up levels in excess of 1.3m sq.ft. The survey, commissioned by MOAF, predicted that when a level of normality returns it will be very much ‘business as usual’ with headline rents remaining on course to break £40.00 sq.ft alongside the continued stabilisation of rent-free incentives.
Commenting for Matthews & Goodman, David Laws, Partner and Head of the Manchester Office said, “This is an encouraging first quarter for the market with a healthy level of demand satisfied across a wide cross-section of buildings.
“The current pandemic will undoubtedly have a knock-on effect for the remainder of the year; however, it is apparent that those deals which are suitably advanced continue to be progressed. It is anticipated that post lockdown there will be a number of revised requirements circulated in the market as occupiers seek to re-evaluate their operational needs following a prolonged period of working remotely from the office”.
MOAF is made up of Avison Young, BE Group, CBRE, Colliers International, Canning O’Neill, Cushman and Wakefield, Edwards and Co, Hallam Property Consultants, JLL, Knight Frank, LSH, Matthews & Goodman, OBI, Savills, and Sixteen.