Manchester’s prime office supply is set to fall to its lowest levels since 2005 over the next two years, signalling an imminent rise in rents in the city centre, according to Savills research highlighting undersupply across the city.
Savills said it expected above-average take-up in 2017 and 2018 to stimulate a new round of development and refurbishment as overall city centre vacancy falls into single digits. In the short term, however, grade A supply will continue falling from 422,000 sq ft to 265,000 sq ft in 2019.
Similarly, residential development has failed to meet Greater Manchester’s annual demand for 10,350 new homes in all but two years since 2001. Although total completions rose by 14% to 6,190 between 2015 and 2016, it was only 60% of what the city needs.
There are 54 schemes under construction in and around Manchester. The biggest of these is Owen Street, which has planning permission for 1,508 homes.
Limited supply also extended to industrial in the North West, with the region’s total supply of available space falling by 11% to 5.5m sq ft in the first half of 2017. Almost three-quarters of this is grade B or C space, the lower end of which is no longer fit for purpose, Savills said.
EG’s Manchester Question Time, featuring Greater Manchester newly installed mayor Andy Burnham, takes place tonight at Manchester Town Hall. The event is free to attend with a few spaces still available. Click here to register.
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