Take-up

H1 2023 take-up totalled 400,000 sq ft in Leeds city centre. This was a success for the market, beating the ten-year H1 average by 40% and recording the third-best H1 that Savills has on record for the market. However, with falling Prime availability in an already severely undersupplied market, this may have a limiting effect on occupational demand levels in the second half of 2023.

Grade A take-up was 185,000 sq ft in H1 which accounted for 80% of the overall total. This is indicative of the continuing flight-to-quality that is being seen in the Leeds market.

Supply

Total availability stood at 740,000 sq ft at the end of Q2 2023, which was broadly in line with the Q4 2022 total. Thanks to resilient demand for best-in-class, Prime availability fell by 24% to 109,000 sq ft at half-year end.

The total vacancy rate for the market stood at 6% at the end of H1, which is 250 basis points below the ten-year average. At the Prime end of the market, supply remains extremely constrained, with just 0.3 years of availability based on average Grade A demand.

Take-up by business sector

The ‘Banking’ sector was the most active in H1 2023, accounting for 32% of total take-up. This came as a result of the 125,000 sq ft acquisition by Lloyds Banking Group at MEPC’s 11 and 12 Wellington Place which was the third largest transaction for the market that Savills has on record.

Elsewhere, the ‘Professional’ sector was the second most active, recording 78,000 sq ft take-up which equated to 19% of the overall total across 19 completed transactions. This was the largest number of completed H1 transactions recorded by the sector since 2007.

Rents

The prime rent grew by 3% in H1 2023, standing at £37.00 per sq ft at the end of Q2. Furthermore, Savills latest rental forecasts expect headline rents to grow further to reach £38.00 per sq ft at the end of 2023. Average Grade A rent in H1 was £30.55 per sq ft which represented growth of 23% on the 2019 average as the top end of the market continues to perform strongly from a rental perspective.

Interested in other areas of the UK?

View all of our latest H1 2023 Occupational Office Data research here.