Take-up

2024 take-up in Manchester totalled 1.22 million sq ft, 29% higher than 2023 and 17% above the five-year annual average. This was achieved through 200 transactions, with six of these over 30,000 sq ft. Manchester had the highest office take-up of all the regions in 2024.

2024 Grade A and Prime take-up totalled 362,462 sq ft and 509,742 sq ft, respectively, and combined resulted in a total of 872,204 sq ft. This is the highest annual total on record and accounted for 71% of take-up, with 60 deals for Grade A or Prime space, 33% above the five-year average number of deals for these grades.

Supply

Availability at the end of 2024 stands at 3 million sq ft, a decrease of 2% on the previous quarter. Consequently, this means that the vacancy rate has also decreased by 30 basis points to 12.1% since Q3, continuing to illustrate the strong demand within Manchester.

Grade A and Prime availability stand at 736,219 sq ft and 762,983 sq ft, respectively, a decrease of 4% and 10% on Q3 2024. This means that the combined vacancy rate has decreased by 50 basis points to 5.9%. The market continues to be considered as undersupplied by Savills, with just 1.4 years of Prime supply to feed the increasing demand from occupiers.

Take-up by business sector

The 'TMT' sector was the most active sector during 2024, with a proportion of 23% of the total take-up. The sector leased a total of 271,918 sq ft over 38 transactions. Another active sector was 'Banking', which leased a total of 226,805 sq ft of space through six transactions, and therefore accounting for 19% of the total. This was the sector's highest total take-up since 2010 and was significantly bolstered by the largest letting of the year to BNY Mellon at 4 Angel Square.

Mean average transaction size has seen a notable increase in 2024, with the average now totalling 6,120 sq ft. In comparison to 2023, this represents an increase of 43% and is also 12% higher than the five-year average size.

Prime headline rent

The Prime headline rent in Manchester increased during Q4 2024 and now stands at £45 per sq ft, compared to £43 per sq ft in Q1 2024. The new top rent was achieved at No.1 St Michael's, with Channel 4 taking 12,293 sq ft. The market witnesses a continued constrained supply of best-in-class space, and occupiers' willingness to pay higher premiums for prime buildings has driven significant rental growth of 20% over a five-year period. Looking at further projections over the next five-year period, we anticipate there will be considerable rental growth of 18% based on current rental levels, with rents of £53 per sq ft set to be achieved by 2029.

Interested in other areas of the UK?

View all of our latest Q4 2024 Occupational Office Data research here.