Leeds’ office market had a strong second quarter, with 134,796 sq ft let in the city centre – a 28% increase on Q1. In the out-of-town market, 91,713 sq ft of office deals completed – a 65% increase on the first three months of the year.
However, the region is relying on smaller “bread and butter” deals, according to Carter Lowler leasing agent and Leeds Office Agency Forum spokesman Richard Fraser.
Burberry’s deal to take 46,058 sq ft at Rockspring Property Investment Managers’ 6 Queen Street in May was the largest city centre deal to complete for more than two years. Baird Group’s freehold acquisition of the 10,681 sq ft Riverside House was the only other city centre transaction above 10,000 sq ft.
Fraser said: “While we have seen the largest city centre deal since 2015 in this quarter, with the 46,058 sq ft letting at 6 Queen Street, by and large the market continues to be driven by a strong churn of ‘bread and butter’ office deals below this size bracket.
“At the half year point, transactional volumes are 23% higher than at the same time last year and the number of deals has seen a 39% increase in comparison with the same period.”
Eamon Fox, partner at Knight Frank, added: “With a continued focus by occupiers on grade-A kit, we have also seen an increase in headline office rents. Prime city centre space is now commanding £30 per sq ft, and we have also seen upward movement to around £22 per sq ft in the out-of-town market.
“Looking to the rest of 2017, there are a range of lease events due to be triggered this year and into 2018 and 2019, particularly on space occupied by larger corporates. Combined with a healthy number of sizeable live requirements, we are predicting a strong overall performance.”
The Leeds Office Agents’ Forum was established in 2010. Its members are BNP Paribas Real Estate, Carter Towler, Carter Jonas, CBRE, Colliers International, Cushman & Wakefield, Eddisons, Fox Lloyd Jones, Bilfinger GVA, JLL, Knight Frank, Lambert Smith Hampton, Ryden, Sanderson Weatherall, Savills and WSB.
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