The North East has chalked up the biggest quarterly take-up of office space on record, as the region rebounds from the Covid-19 pandemic.
Occupier confidence across the Big Nine office markets has reached its highest level since the pandemic started, the latest market report from Avison Young has shown.
Increasing confidence has released pent-up demand and requirements that have been on hold during the past 18 months, leading to a large number of significant deals in the third quarter.
The Quarter Three research of the Big Nine office markets – which takes in Birmingham, Bristol, Cardiff, Edinburgh, Glasgow, Leeds, Newcastle, Liverpool and Manchester – has shown a big leap in occupier confidence, with take-up amounting to 2.3m sqft across both the city centre and out-of-town markets, 10% up on the 10-year average.
Read more: Find more property news here
Headline rents are now £32.61 per square foot across all nine cities - and looking ahead, Avison Young researchers said there continues to be a considerable weight of money looking to invest in the regional office market, with the fourth quarter expected to be the strongest of the year.
In terms of city centre deals, Manchester tops the workspace figures, with 257,164sqft, closely followed by Glasgow on 250,659sqft. Newcastle lags behind on 41,193sqft.
However, within out-of-town deals the North East streaks way ahead of the rest of the 海角视频, with 327,929sqft.
Most Read
The region’s office market recorded its strongest quarterly take-up on record, following the letting to JustEat, which has taken 217,339 sqft at the former EE contact centre at Rainton Bridge. Oak House Estate taking up 27,000sqft at Tenor House in Sunderland also aided its position at the top of the pile.
The out-of-town market accounted for almost 90% of the 369,000 sqft take-up total, which included four further deals over 10,000 sq. ft.
The largest occupier in the city centre was also an inward mover into Newcastle - 13,334 sq. ft to Debit Finance at Central Square South.
Tony Wordsworth, director at Avison Young, Newcastle, said: “Sentiment remains positive with deals in the pipeline and a healthy level of enquiries, many of which were put on hold during the pandemic.
“Occupiers are returning and viewings are increasing, albeit many are looking for slightly less but better-quality space. A number of occupier moves are considering carbon commitments, which means new or refurbished space is in high demand.
“Consequently, there continues to be considerable interest in the remaining four floors at the recently completed Lumen and The Spark, which is under construction. In addition, 120,000 sq. ft Bank House on Pilgrim Street is fully available, but not due to complete until Q1 2023. Headline rents remain at £26 per square foot, although asking rents are now at £27 psf.”
Following recent lettings to JustEat and EC Outsourcing in Sunderland, dozens of commercial property agents, inward investment officials and representatives from Sunderland City Council gathered recently at a launch event on Doxford International Business Park, for an first viewing of the newly revamped One Victory Way.
Don’t miss
Landlord Victory Way Doxford Ltd has ploughed £1m into the building, to help accommodate organisations looking for office space in the area, and more than 34,000sqft of workspace across three floors could soon be home to hundreds of workers.
In Newcastle, Central Square South has welcomed a trio of lettings, taking the building to over 90% occupancy for the first time since it underwent significant refurbishment in 2016.
Acting on behalf of owners Aberdeen Standard Investments, joint agents Sanderson Weatherall and Cushman & Wakefield negotiated the latest lettings to Xplor Technologies, Lumo and Clyde & Co.
Xplor Technologies have signed up for the whole of the first floor, which extends to 13,334 sq ft, Clyde and Co relocated to the ground floor taking 4,474 sqft and transport group Lumo has acquired 5,457 sqft on part of the 4th floor.
Meanwhile in Middlesbrough, property developers Python Properties has welcomed a record number of new tenants across their Teesside office buildings.
The organisation’s portfolio of commercial properties within Teesside, consisting of Boho Zero, Cargo Fleet Offices and The Co-operative Buildings, have taken over 25,000 square foot of new lettings so far this year.
New tenants include insurance broker Bespoke Financial, Middlesbrough Council, Echo-U and global engineering company Mott Macdonald.
The new arrivals come after Python Properties invested over £300,000 into improving their three buildings during the pandemic, with the most recent transformation going into Boho Zero, formerly known as Royal Middlehaven House.
Each building has a range of amenities including art galleries that can be used as exhibition space, manned receptions, on-site cafes and secure car parking.
Martin Johnson, partner at Python Properties said: “It has been great to see a large number of new tenants across our three buildings in Teesside, including many new companies and companies from outside of our area, particularly during this extremely challenging time.
“When we first acquired the buildings, they were run down and in need of a major overhaul, we have since worked hard to regenerate each building into high spec office space built for modern day businesses, so it’s great to see local, national and indeed global companies recognising this and choosing us as a place to base their business.”
Sign up for the commercial property newsletter here.