• Whilst occupier demand has fluctuated, long term average take-up is 98,000 sq ft which highlights the demand in the market. 2018 so far has been relatively subdued for take-up. The only deal above 10,000 sq ft in 2018 was Frontline leasing 12,000 sq ft at Stuart House.

• Supply levels in the market continue to fall and there is currently 250,000 sq ft available. This represents a fall of 47% from 2014. Permitted development rights have significantly eroded the office stock in Peterborough. It is estimated that at least 600,000 sq ft of office space has been sold with the intention of conversion to residential use in the last three years. This equates to approximately 15% of Peterborough’s total office stock.

• The reduction in available office space has resulted in upward pressure on Grade A rents with prime rents now quoting in the region of £15-£17 per sq ft. Furthermore there are only three buildings in the city centre that can accommodate requirements above 10,000 sq ft which could hamper take-up from increasing.

• Speculative development in the market is not financially viable unless a pre-let is secured. This however does present an opportunity to developers and investors who could refurbish existing stock in the short term and drive continued rental growth. A notable example of a refurbished scheme returning to the market is Lynchwood House which comprises 60,000 sq ft, quoting rents are currently £17.00 per sq ft.

• Peterborough experienced a wave of back office relocations in the 1980's from financial services companies, and whilst some have contracted, large corporates such as Thomas Cook, Bauer and RNIB have recently committed to longer leases in the city.

• There continues to also be strong demand from local companies in the sub 5,000 sq ft category.

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