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GVA research reports big deals help 'big nine' regional office markets top five year average

Tuesday, 01 August 2017

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The latest research from leading real estate adviser, GVA, reveals a return of larger deals to the UK's 'Big Nine' office markets.

Figures have been skewed by strong activity in Edinburgh and Manchester which accounted for over half of city centre take-up. Notably, the Government Property Unit's 189,000 sq ft pre-let in Edinburgh and a number of significant inward investment transactions helped lift take-up activity in the second quarter and surpass the five year average by 4%. In Manchester, WeWork has taken its first space outside London, committing to 55,800 sq ft at No 1 Spinningfields and tapping into the growth of the TMT sector.

GVA’s 'Big Nine' report reveals that finance, professional and business services have all shown a greater proportion activity (55%) when compared to the five year average (50%). Government services increased from 10% to 15% of activity following the GPU deal but the TMT sector was marginally below average at 13%. There was also a fall in manufacturing activity, which halved to 4% of take-up. GVA noted an increase in serviced office space, in addition to the We Work's letting of 55,000 sq ft in Manchester.

The report also notes that developers remain cautious and speculative funding is sparse; emphasised by the increase in comprehensive refurbishments and councils entering agreements with developers to advance new construction.

Carl Potter, National Head of Offices at GVA comments: "Recent political uncertainty has dampened occupier confidence, reflected in a slowdown in enquiry levels in some of the cities across the UK. Despite this, take-up activity is up on Q1 and is 4% above the five year average, thanks to the welcome return of larger deals to the 'Big Nine' regional office markets.

He added: "Encouragingly, there are also significant inward transactions among the large deals with Australian financial services firm, Computershare, creating new jobs in Edinburgh as well as Swiss distribution company, Distrelec, choosing Manchester for their European headquarters."

For any further information on GVA's latest Big Nine report, please contact Carl Potter, Senior Director and National Head of Offices at GVA on 0121 609 8388 or email carl.potter@gva.co.uk.