Take-up

2022 regional office take-up totalled 5.8 million sq ft. Whilst this represented a marginal increase of 2% on the 2021 total, it was the second consecutive year of improvement as the market looks to recover from the effects of the pandemic.

2022 Grade A take-up totalled 2.7 million sq ft which was broadly in line with the quantum of Grade A take-up recorded in 2021. 2022 Grade A take-up was spread across 296 transactions, the largest number of deals that Savills has on record since 2000.

Supply

Total supply stood at 14.4 million at the end of 2022. This was broadly in line with the supply total at the end of 2021. Grade A supply decreased in 2022 to 4.4m sq ft. This was an 11% decrease on the 2021 figure.

There is currently less than two years of Grade A supply in eight of the ten regional markets based on average demand. Furthermore, in Birmingham, Leeds, Edinburgh, and Oxford, there is less than one year of Grade A availability, demonstrating the lack of supply for best-in-class space.

Take-up by business sector

TMT was the most active sector in 2022, recording 19% of overall take-up. TMT has been the most active sector in terms of both take-up and total deal count in four of the last five years. The largest deal in the sector in 2022 was the 65,000 sq ft Grade A letting to BT at 3 Capital Quarter in Cardiff.

Elsewhere, it was also a strong year for Professional sector take-up. There were 239 completed Professional deals in 2022 which is the largest number of transactions that Savills has on record since 2000. The largest deal in the sector was the 63,000 sq ft Grade A acquisition by Deloitte at 100 Embankment in Manchester.

Rents

Cambridge continues to hold its position of the highest prime rental value outside Greater London and the South East at £57.85 per sq ft. In terms of rental growth, the Bristol market saw growth of 12% in 2022, reaching £42.50 per square foot. This establishes Bristol as the highest prime rent in the UK Big Six markets. That being said, at the end of 2022, three of the Big 6 markets (Bristol, Birmingham, Manchester) had been able to establish prime rents at or above £40.00 per sq ft. Savills expects further growth across the Big 6 markets in 2023.

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