According to the latest Crane Survey by Deloitte, new development in UK regional cities (Manchester, Birmingham, Leeds and Belfast) is experiencing a boom. There are over 81 new developments across sectors including offices, hotels, retail and homes. 

In terms of office space, the story is particularly positive, with 16 new developments being recorded across the four cities. Leeds has experienced the biggest rise in space, seeing the volume under construction grow by 67 per cent: from 460,000 sq ft in 2016 to 770,000 sq ft in 2017. This contrasts with London where new office development has fallen to its lowest level in more than three years.

Take-up in Leeds reached record breaking levels in 2017, with city centre take-up reaching 1 million sq ft and top rents reaching £30 per sq ft. The city’s office market is characterised by a lack of Grade A stock in an environment of increasing demand. The popularity of Leeds has been boosted by significant deals including the relocation of Burberry and the activity of Government departments including the NHS and HMRC.

There has also been an increase in activity from the serviced office sector: 2017 was a record year for take-up by these providers with levels reaching over 60,000 sq ft. Firms such as Regus and Bruntwood are well established in the city, and there’s been a flurry of independent providers moving in and taking smaller floorplates.

So what will follow record-breaking 2017? Looking ahead to the rest of the year the completion of MEPC’s 3 Wellington Place will provide an additional 110,000 sq ft of much needed Grade A space. There are also several sites that are being looked at for redevelopment into offices, including around Whitehall Road and on the South Bank which could provide a combined 1.325 million sq ft of additional space. Looking even further ahead to 2019, we expect the availability to have pushed top rents to £32 per sq ft.

With development on the rise and plenty of new opportunities in the pipeline, the future looks good for the Leeds office market and we expect 2018 to be another strong year for the city.

Further information

Contact Savills Commercial Agency Services in Leeds