Take-up

Q1 2023 take-up totalled 275,000 sq ft in Leeds city centre. This marked a particularly successful start to the year for the market, with take-up 84% above the long-term average and the best Q1 that Savills holds on record since 2007.

Grade A take-up was 235,000 sq ft in Q1 which accounted for 86% of the overall total. This Grade A demand was heavily driven by Lloyds Bank, which acquired 125,000 sq ft at MEPC’s 11/12 Wellington Place. This was the third largest transaction in the Leeds city centre office market since 2007.

Supply

Total availability at the end of Q1 stood at 741,000 sq ft. This means that availability decreased by 5% in the first quarter of 2023. Furthermore, Grade A supply fell by a further 3% to 177,000 sq ft. Prime availability remains constrained at just 137,000 sq ft of available space in the market.

The total vacancy rate for the market fell by 40 basis points in Q1 to 6%. Based on average demand, there is currently just 1.3 years of supply in the market, and for the Prime A space, there is just 0.3 years of supply based on average Grade A take-up.

Take-up by business sector

The Banking sector was the most active in Q1 2023, accounting for 46% of total take-up across two completed transactions.

Elsewhere, the Professional sector was the second most active, recording 31,000 sq ft take-up, which equated to 11% of the overall total across nine completed transactions. The largest Professional deal in Q1 2023 was Stantec’s 7,800 sq ft Grade A acquisition at 2 Whitehall Quay.

Rents

The prime rent grew by 3% in Q1 2023, standing at £37 per sq ft at quarter end. Furthermore, Savills latest rental forecasts expect headline rents to grow further to reach £38 per sq ft at the end of 2023. Average Grade A increased in the first quarter of 2023 to £31.83 per sq ft. This represented a 27% increase on the pre-Covid 2019 average.

Interested in other areas of the UK?

View all of our latest Q1 2023 Occupational Office Data research here.