Manchester Update

Recent research by Avison Young and MOAF reveals that Manchester city centre office activity reached 491,300 sq ft during Q2. The figure was 64% above the quarterly average and brings the year to date total to over 800,000 sq ft. Metropolis ran 40 business leads featuring companies relocating in the Manchester market in Q2 2019.

The largest move of the quarter involved Spaces agreeing the largest flexible workspace deal in the UK outside London, taking 122,000 sq ft at 125 Deansgate.  It also understood that BT is close to taking a significant amount of space. Other large moves recently researched by Metropolis included relocations by Hewlett Packard, ME Group, Jones Lang Lasalle and BASF.

There is considerable activity from the flexible workspace sector as WeWork has signed for its fourth location in Manchester, 51,000 sq ft at Hyphen and there are more than half a dozen co-working operators
looking for substantial amounts of space. Business services tends to dominate take-up in Manchester, accounting for a third of take-up.

Advertising and public relations company WPP have committed to 82,000 sq ft which will be constructed at Enterprise City, St John’s. Barclays expanded by 33,000 sq ft at Piccadilly Place. The largest deal in the out-of-town market was to telecommunications company Verastar, which has agreed a 61,000 sq ft deal at One Dovecoat in Sale. Marks & Spencer took 12,000 sq ft at the Alexandra, The Home Office taking 20,490 sq ft at the Soapworks and Capgemini taking 11,360 sq ft at Venus.

Looking ahead, Metropolis is monitoring almost 40 medium/large firms looking for space in Manchester, together with a further 70 tenants approaching lease expiries over the next two years.

There is 1.6 million sq ft of space under construction in Manchester, of which 38% is pre-let. Of the million sq ft of speculative space under construction, key developments include Landmark Oxford Road, 100 Embankment and Circle Square. Grade A remains in good stock with new developments such as 125 Deansgate and Landmark at St Peter’s Square due to complete in 2019. Between them they will bring 305,000 sq ft to the market, 133,000 sq ft of this currently under offer to new tenants.

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200 Movers in Manchester

A recent report from the Manchester Office Agents Forum (MOAF) revealed a total of 1.208m sq ft of office lettings across 271 transactions in 2017, well above the 10-year average.

Metropolis ran over 330 business leads on Manchester office moves in 2017, which if all added together would total over 10m sq ft.

MOAF said strong demand for prime offices has left the market with a record low supply of Grade A office space.

The main schemes with available space are 101 Embankment, No 1 Spinningfields, 3 Hardman Square, 40 Spring Gardens and 2 St Peter’s Square, which is likely to trigger some short-term refurbishment projects

There are a number of Grade A schemes under construction to include Landmark (180,000 sq ft), 125 Deansgate (126,000 sq ft), Hanover, NOMA (90,000 sq ft), Circle Square (230,000 sq ft) and 11 York Street (80,000 sq ft), the majority of which will be delivered in mid-late 2019.

Key office lettings in 2017 included: 55,802 sq ft to We Work at No1 Spinningfields and 44,000 sq ft at One St Peters Square, 77,449 sq ft to DWP at 2 St Peters Square and Clyde & Co taking 69,000 sq ft at Manchester Royal Exchange.

Metropolis research also relayed early warning news of large Manchester moves by companies including Barclays Bank, Distelrec, Bupa, Callcare, Virgin Media and The Hut.

Forthcoming Manchester moves tipped by Metropolis for 2018 or beyond total just over 200.

If you would like some information on flexible Metropolis subscription packages or to discuss a trial, then please email Simon at simon@metroinfo.co.uk

Manchester’s Top Future Relocations

Lambert Smith Hampton has just released its Manchester office market report for Q2 2017. City centre office take-up for reached 284,497 sq ft across 68 transactions, a 23.3% increase on the same quarter in 2016. The cumulative 492,730 sq ft for the first half of 2017 is an increase of 14.6% on 2016.

The latest big relocations, movers and inward investments included: co-working giant We Work taking 55,802 sq ft offices at No.1 Spinningfields. Weightmans took 17,949 sq ft at the same building. EY is taking 40,000 sq ft at 2 St Peters Square; Car Finance 247 is relocating to 40,000 sq ft at Universal Building, Devonshire Street North; Distrelec is taking 17,000 sq ft at 2 St Peter’s Square, while Vodafone signed for 33,000 sq ft at Atlantic House.  Lookers acquired the 21,000 sq ft Aspect House in Altrincham,  21,200 sq ft was let at Regent Place, Salford to Convergys and Kaplan Financial also agreed a 10,000 sq ft move. Deals under 3,000 sq ft still accounted for 40% of take up

LSH secured the largest office deal this year outside of the city centre by acquiring 47,149 sq ft at 106 Dalton Avenue at Patrizia UK’s Birchwood Park, Warrington for Cavendish Nuclear. Business Services, consumer services and leisure and banking and finance have been the strongest sectors for take-up in the first half of the year. These three sectors accounted for 34%, 20% and 18% of take-up respectively

Metropolis is monitoring around 50 current office requirements in Manchester and around 60 ‘potential movers’, that is companies approaching lease expiries or with expansion plans, which have not decided whether to move yet.

Looking ahead, Manchester is expected to see faster office based employment growth over the next five years than Greater London and all of the major UK regional cities. Office based employment is
expected to grow by 6% over the next five years, significantly above the UK average of 3.5%.

Manchester Office Market Summer 2016

Lambert Smith Hampton has just published its Q2 summary of the Manchester office market.

Manchester city centre office take-up for Q2 2016 reached 218,400 sq ft bringing the total for the first half of the year to 416,110 sq ft. LSH say that a number of large scale transactions are expected to complete in the second half of the year, which could lead to a year end total of 1m sq ft, close to the 5 year average.

Recent transactions included 11,000 sq ft to Mazars at One St Peter’s Square, 33,000 sq ft to the Co-op Bank at Martins House and 16,000 sq ft to Ericsson at MediaCity.

Recent Manchester pre-lets have included:

1 Spinningfields: PWC – 49,400 sq ft
Two St Peters Square: EY – 41,630 sq ft
XYZ: Global Radio – 16,670 sq ft
XYZ: Shoosmiths – 32,000 sq ft
XYZ: NCC Group – 60,000 sq ft

Swinton Insurance is under offer on 160,000 sq ft at 101 Embankment, Freshfields are due to complete imminently on 80,000 sq ft at New Bailey, DWP have a 80,000 sq ft Manchester requirement and PwC are being linked to taking further space at 1 Spinningfields.  There has growth in demand for companies looking to move operations (called northshoring) from London, for example law firm Freshfields, as well as Lonza and Escada opening new city centre operations.

Metropolis is also monitoring over 60 named Manchester office requirements from a wide variety of companies such as the likes of AJ Bell and Weinberger, as well as over 100 approaching lease expiries in late 2016 and 2017.

There is just over 1m sq ft of new office space under construction in Manchester, including schemes such as English Cities Fund’s 190,000 sq ft Two New Bailey and Ask Real Estate’s 164,000 sq ft 100 The Embankment.

 

Manchester – Some Years Are Bigger Than Others

A recent report by Savills on the Manchester office market highlighted an increase in office take-up in Q1 2014. Office space transacted in Manchester rose from 215,000 sq ft in the last 3 months of 2013 to 317,000 sq ft in the first quarter of 2014 in 69 deals. Metropolis looks at recent deals and future forecasts.

Manc

Barclays took 80,000 sq ft at Carlyle’s 4 Piccadilly Place scheme and Trader Media took 60,000 sq ft at Ask Development’s No1 First Street. Costain, the construction group, identified new regional office space of 3,437 sq m (37,000 sq ft) to relocate to at Goodman’s 1500 Aviator Way on Manchester Business Park. While Emirates Airways took 2,323 sq m (25,000 sq ft) at Goodman’s Building 1000, also on Manchester Business Park.

Despite the large deals it is the smaller, often sub-5,000 sq ft, moves in Manchester, which make up the majority of the market activity. Local agents put this down to a two tier office market, which includes a large amount of second hand available office stock, whereas newly built or refurbished grade a stock is in short supply.

The Manchester office market is split by local agents into five areas:

  • Core
  • Spinningfields
  • Piccadilly
  • NOMA/Victoria
  • St Peters Square

Manchester’s national and international profile has enabled it to register around 1m sq ft of take-up every year. Local agents believe that there is close to 800,000 sq ft of requirements in the market in Manchester. Metropolis is currently tracking over 40 Manchester searches by local and national companies including PWC, Ticketmaster and Age Concern. If the current pace of lettings is maintained the office take-up total for 2014 could again top 1 million sq ft.