Take-up

Combined Q3 2023 Cardiff take-up was 66,000 sq ft across 17 transactions in the quarter, which is only 6% below the Q2 2023 take-up total. Additionally, the smaller size bands continue to dominate in Q3, with 60% of take-up under 10,000 sq ft, spread across 15 deals done. Combined, Q1–Q3 take-up amounted to 214,000 sq ft.

Grade A take-up equalled 10,000 sq ft which consisted of three deals done, with the largest letting totalling 7,000 sq ft. This was acquired by Arcadis Consulting at Hodge House.

Supply

At the end of Q3 2023, total availability for the market equalled 1.5 million, a 1% decrease on the same period in 2022. Grade A supply totalled 330,000 sq ft which was 3% above Q2 2023. However, this only accounted for 21% of the total supply for Cardiff in Q3, therefore falling by 7% since H1 2023. This shows that there is a lack of Grade A supply in Cardiff.

The total vacancy rate for Cardiff still stands at 14%, although the Grade A vacancy rate has decreased to 3% in Q3 from 3.9%. This indicates that occupiers are continuing to look for best-in-class space in Cardiff.

Take-up by business sector

'Manufacturing & Industry' was the most active sector during Q3 2023, comprising 25% of take-up total. This was based on one transaction that amounted to 16,000 sq ft, which saw Kocaer acquire 3 Alexandra Gate. Furthermore, this represented the only deal that has been recorded for this sector in Cardiff since Q4 2021.

The third quarter of 2023 also saw 'Extraction & Utilities' as the second most active sector, with one deal that totalled 10,000 sq ft, accounting for 15% of the total take-up. This was the first deal over 10,000 sq ft for this sector in Cardiff since Q1 2016, where 13,000 sq ft of space was leased at Greenmeadow Springs.

Rents

There was no change in the prime rent in Cardiff during Q3 2023, with the prime rent remaining at £25 per sq ft. There has, however, been an increase in 2023 overall, with rates rising for Grade A space to £23.35. This represents an increase of 4% on 2022 average Grade A rents, therefore closing the gap against Prime rents in the market. Looking at growth forecasts, it is expected that Prime rents in Cardiff will reach £35 per sq ft by the end of 2027, a rental growth increase of 28%.

Interested in other areas of the UK?

View all of our latest Occupational Office Data research here.