If you’re a company looking for new offices in Cardiff at the moment, finding space that meets your requirements may be easier said than done.

As we highlighted at the end of last year, a lack of available Grade A space in the city held back office take-up throughout 2019. Available office supply in the wider city market currently totals just under 1 million sq ft (92,900 sq m), although only just over 100,000 sq ft (9,290 sq m) of that is considered to be of Grade A standard.

Occupiers currently looking for Grade A space within Cardiff are therefore largely limited to looking at development projects to pre-let space, but they’ll be waiting until at least 2021/22 before they can take up residence, or, if their demand is more urgent, refurbished offices.

Two of the latter type of projects are due to be delivered in the medium term (Legal and General’s £10 million transformation of Hodge House into 67,000 sq ft of contemporary office space and Fidelity’s refurbishment of the 63,000 sq ft Fusion Point building). Given that we’re tracking over 150,000 sq ft of lease expiry events in the city this year, and the combined total of these two schemes offer 130,000 sq ft of offices, if an occupier hasn’t already pre-let space in one of these, or if they don’t happen to be suitable for their requirements, their choices may be limited.

Those businesses with a lease event next year may face a similar quandary. These occupiers should start their search sooner rather than later, if they haven’t already; the days of starting to explore options 12 months in advance of a lease event are long gone.

The pressure may be relieved somewhat in 2022-2023, as the volume of lease events falls back and new Grade A stock is completed, but again looking ahead at 2024-2025 we’re seeing another spike in demand for space across the two years. 2024 sounds like it’s a long time away, but even these occupiers should start looking at their options at least 24 months in advance. 

All this means that there are opportunities for office developers in the city centre. Any schemes going through the planning process at the moment won’t be ready for at least a couple of years, but new projects submitted now may well be able to tap into that upsurge in demand in 2024-25 and prove popular with potential occupiers for pre-lets.

Cardiff attracts a wide group of occupiers and with its office rents some of the most affordable in the UK this will continue. While potentially challenging for some companies, the market does, however, offer opportunities for those willing to speculatively develop and its continued popularity as a hub for business is something to celebrate rather than commiserate.

Further information

Read more: Spotlight: Cardiff Offices