Manchester has the largest pipeline of grade-A office stock since the recession of 2008, according to research by Colliers International.
The total amount of grade-A space being built and due for completion by 2019 spans approximately 733,000 sq ft across six developments – 2 St Peter’s Square, 1 Spinningfields, 8 First Street, 125 Deansgate (Lincoln House), Hanover NOMA and Landmark, the former Odeon cinema site – with 146,000 sq ft already let, leaving 586,466 sq ft available.
A further 1.26m sq ft of consented grade-A office space where construction is yet to start includes seven buildings: 11 York Street; 2 Angle Square; 3 Angle Square; Astley/Byrom; 1 Brazennose, 100 Embankment and 2 New Bailey Square.
Projects for delivery beyond 2020 include major mixed-use schemes with high office content, such as the 14-storey office building proposed by Ask Real Estate as part of its planned redevelopment of the 1.74-acre former Bauer Millett car showroom site adjacent to Hilton Tower.
Peter Gallagher, director, national offices at Colliers International in Manchester, said: “Manchester has always prided itself on having a ready supply of good quality, ready-to-occupy offices available, which has enabled us to compete effectively for large footloose enquiries. Although the current shortage has threatened that ability, the number of projected schemes in Manchester represents the largest pipeline of stock in the city since the recession, although more than half of the schemes due to complete in 2017 have already been prelet.”
Manchester city centre currently has about 150,000 sq ft of existing and available grade-A space with the two largest single-floorplate suites for immediate occupation being 41,000 sq ft at 1 St Peter’s Square and 22,985 sq ft over two floors at 40 Spring Gardens.
Colliers’ Q1 2017 snapshot recorded take-up of 208,233 sq ft of high quality office space in 73 transactions, 6% above the total for the first quarter of 2016 but with an average transaction size of 2,853 sq ft, compared with 4,017 sq ft in the same three-month period in 2016.
Gallagher said the ongoing imbalance between supply and demand of grade-A space will further increase upward pressure on rents, with the best quality accommodation forecast to hit £40 per sq ft by the end of the decade, compared to existing headline rents of £35 per sq ft.
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