The UK’s biggest regional office markets have seen a surge in leasing activity, boosted by big deals in Manchester and Birmingham.
Regional office take-up increased by 35.6% year-on-year in the third quarter to reach 1.47m sq ft, the highest quarterly take-up since Q4 2021, according to BNP Paribas Real Estate.
The government and education sector accounted for the largest share of take-up at 27%, followed by professional services (25%) and banking/finance (17%).
Big deals included Aston University taking 189,053 sq ft at 10 Woodcock Street in Birmingham and Bank of New York Mellon’s 200,000 sq ft letting at 4 Angel Square at NOMA in Manchester (pictured).
Prime rents increased almost 7% year-on-year on average. Bristol leads the way at £48 per sq ft, followed by Edinburgh (£46), Manchester (£44), Birmingham (£42.50) and Glasgow (£39.50).
Josh Arnold, senior research analyst for offices at BNP Paribas Real Estate, said: “The latest leasing data shows an encouraging shift in activity, with year-to-date take-up levels now the highest since before the pandemic.
“Take-up in Q3 was boosted by significant deals over 50,000 sq ft. However, despite sizeable requirements across key regional cities, question marks remain over whether this momentum can last, given the limited pipeline of grade-A stock under development.
“The latest prime rental figures underscore the ongoing ‘flight to quality’ within regional office markets, as organisations increasingly seek out high-spec, well-located spaces.”
BNP Paribas’s research covers Bristol, Manchester, Birmingham, Edinburgh, Glasgow, Leeds, Newcastle, Sheffield, Cardiff and Liverpool.
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