Robust Final Quarter boosts 2016 Take Up
The Manchester city centre office market finished the year with a flurry of activity and posted the strongest quarter of take up since 2010. In this final quarter alone 83 transactions were undertaken, accounting for 621,016 sq.ft. of office space.
Overall, take up for 2016 amounted to 1,306,599 sq.ft. which is roughly on par with 2014 and 2015 figures which both exceeded 1.3m sq.ft..
Key transactions for Q4 included: Swinton Insurance taking 165,005 sq.ft. at 101 Embankment – which incidentally was also the largest transaction in 2016; Co-op Digital taking 45,446 sq.ft. at Federation House, NOMA; Manchester Metropolitan University purchasing 63,661 sq.ft. at 6 Marlborough Street; and the pre let of Stubbs Mill in its entirety to Fanatics.
Further analysis of these take up figures presents a similar trend with previous years regarding deal sizes, with nearly two thirds of all transactions being of 6,000 sq.ft. or below.
In addition, there is evidence which demonstrates rents in the city centre are certainly increasing – with buildings that were commanding rents of c. £14.50 - £15.00 per sq.ft. 2 years ago, now quoting and achieving rents of £17.50 per sq.ft. upwards. 54 Princess Street and 56 Princess Street are prime examples of this and demonstrate that where landlords have invested in refurbishment works, they have subsequently enjoyed strong rental growth. At the top end of this scale, we have seen some refurbished offices, such as Bruntwood's NEO building on New York Street, pushing rents of £25 - £30 per sq.ft..
Regional take up was also strong with Salford Quays posting an overall take up of 314,923 sq.ft.. Recent lettings at Tomorrow at MediaCityUK featured heavily in the final quarter take up alongside 8 new lettings at Salford Innovation Park.
South Manchester saw a slight dip in total take up from 563,453 in 2015 to 546,701 sq.ft. in 2016. Once again this region saw a robust final quarter with the sale of Lovell House to One Manchester being a notable deal. The building was sold by Edwards & Co on behalf of Ropetune and totalled 27,110 sq.ft..