Take-up

Total take-up for the Manchester City Centre market reached 326,000 sq ft in Q3 2022. This was 10% above the 2019 total and 23% above the ten-year Q3 average for the market.

Grade A take-up totalled 77,000 sq ft in Q3 2022, which equated to 24% of total take-up, with the largest new build Grade A transaction being a 22,000 sq ft letting to serviced office provider Gilbanks at 11 York Street.

Demand for “fitted” offices continues to rise, with 16% of the total number of deals this year being for this type of workspace (up from 10% for the same period last year).

Supply

At the end of Q3, total available supply stood at 3.2 million sq ft. This represented a decrease of 5% on the Q2 total. Grade A supply also fell in Q3 by 8% to 834,000 sq ft at quarter end. This decrease is indicative of the continuation of the flight to quality in the market as demand remains resilient for best-in-class space.

As a result of these changes, the total vacancy rate for the market decreased from 13.2% to 12.6%. Similarly, the Grade A vacancy rate decreased from 3.6% to 3.3% at quarter end.

Take-up by business sector

The Public Services, Education & Health Sector was the most active sector in Q3, accounting for 29% of overall take-up. This included the 36,000 sq ft acquisition by the UK Government on behalf of Government Property Authority at 101 Barbirolli Square.

Elsewhere, it was a particularly strong quarter for the Serviced Office sector, which accounted for 23% of total take-up across four lettings. Total Serviced Office take-up was 75,000 sq ft in Q3 2022, which was just 14% below the annual total achieved by the sector in 2021.

Rents

There was no change in the prime rent in Q3 2022, which currently stands at £38.50 per sq ft. That being said, there is still optimism for growth to £40 per sq ft by the end of 2022 with deals under offer at this level. Average Grade A rents so far in 2022 currently stand at £34.35 per sq ft. This represents a significant increase of 7% on the 2021 figure.

Interested in other areas of the UK?

View all of our latest Q3 2022 Occupational Office Data research here.