Leeds office space take-up has boomed in Q2 2019, rising by 47% since the previous year’s comparable period.
The second quarter of this year saw 213,341sq ft of office space taken up in the city centre, with 27 deals completed.
The largest deal completed was at MEPC’s 4 Wellington Place, where The Stars Group pre-let 135,915 sq ft on behalf of Sky Betting and Gaming, which EG revealed in May.
This pre-let is also the largest office letting to complete in Leeds since 2017, when the Government Property Agency acquired its 378,000 sq ft new hub building on the same scheme.
The only other transaction above 10,000 sq ft was at 7 Park Row, where Regus Spaces took up a 15-year lease for 23,428sq ft, also in May.
Meanwhile, the regional out-of-town market was less active, with take-up reaching just 34,103 sq ft and 18 deals completed.
In the city centre there is just 13,000 sq ft of new build standing Grade A space currently available at 6 Queen Street.
Speaking to EG, JLL director Jeff Pearey said that even taking the Sky Betting and Gaming deal out of account, the city is still on track to meet, or exceed, last year’s total office take-up.
“The Sky Betting deal was a large deal for the quarter, no doubt,” he said. “Even if you take the Sky transaction, you are still around 300,000 sq ft for half year, which is on track at least for an average, if not better than, last year. The underlying trend is positive.”
Commenting on the out of town figures, he said: “This is slightly disappointing, but that is a reflection of the lack of good quality, grade A office supply. If it doesn’t exist it can’t be taken up.”
Colliers International director Roddy Morrison said: “Prime office rents in central Leeds are presently at the £30 per sq ft mark, but given such limited supply we expect to see deals at rentals of £32 per sq ft by the end of the year, with further growth anticipated in 2020.
“This is still 10-15% behind prime rental levels in Manchester, and also below smaller markets such as Bristol.
“As such Leeds continues to be hugely competitive in comparison with other regional office markets, and offers the most competitive office rents and total office occupation costs among the big six cities outside London.”
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