Office space in Bristol is now more expensive than any other big city outside of London, a new report has revealed. Surging demand among businesses and a lack of supply drove up rents last year, the Bristol Office Agents Society found.
Headline rents in the city increased through 2024 to £48 per sq ft - the highest of the big six cities analysed. A lack of "good quality" space also drove up prices on refurbished buildings which in many instances achieved rents of £40 per sq ft.
Though take up of space was below the five and 10 year averages for the year, there was an increase on the level for 2023 and with strong demand towards the end of the year market sentiment going into 2025 is positive, the report said.
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Bristol’s city centre market saw 41 deals completed in the second half of last year with a H2 take up of 187,527 sq ft. Total annual take up in the city centre for 2024 was 440,562 sq ft.
Among the biggest deals was BLOCK’s acquisition of 21,235 sq ft at the newly refurbished building The Fairfax. There were also agreements at UBS’s newly refurbished 3 Rivergate, with Aecom’s taking 15,124 sq ft on the sixth and part of the fifth floors, and DNV taking 11,261 sq ft on the fourth.
Other Grade A lettings this quarter include CBREIM’s letting at Halo of 9,504 sq ft to Softcat; Mazar’s move to 7,821 sq ft at AXA / Bell Hammers Assembly C; and CBRE acquiring 7,309 sq ft of space for themselves at CEG’s EQ.
Several new build schemes also completed in Bristol last year, including CEG’s EQ, Trammell Crow and Tristan Capitals’ Welcome Building, and AXA / Bell Hammer’s Assembly Buildings B & C, all of which secured pre-lets.
Beyond these there are no other new developments under construction. The only major works ongoing are comprehensive refurbishment schemes including APAM’s One Friary, CEG’s Crescent and Abrdn’s Queens Quay.
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Andy Smith, office agency partner at Knight Frank, said: “An election year always has a negative impact on levels of take up as businesses often put moves on hold due to the uncertainty surrounding a new government and 2024 was no different.
"However, even in this challenging market there were a number of significant deals, and occupiers continued flight to quality saw rents rise."
He added: "As we start 2025 there has been a marked uptick in new enquiries both in and out of town which reflects an underlying improvement in occupier sentiment and a slightly less uncertain political and economic outlook for the year.”
Meanwhile, the Bristol out-of-town market saw 13 deals cross the line through the second half of the year to give a H2 take up of 54,773 sq ft. The largest of these was the long leasehold of 13,075sq ft at 23 Clothier Road to Outcomes First Group.
The figure was below the five and 10 year averages but the outlook for 2025 is "more positive", the Bristol Office Agents Society said.
Chair of the South West OAS, and Lambert Smith Hampton’s office agency director Roxine Foster, added: “2024 proved to be a year of mixed fortunes, however the outlook for 2025 is positive and with pressure on supply becoming more and more evident it will be interesting to see which the next schemes are to start on site."
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