Manchester is set to lead the pack in the UK for office rentals, according to new figures published by Colliers International.
Office rents have increased, in what some consider the ‘capital of the north’, by three per cent in 2012, according to the latest net stock absorption report by Colliers. This is significant news considering that this was actually the only growth seen across any of the major regional markets in the UK.
Investors will now look to Manchester as a region for major potential growth in the coming year.
The report has suggested that this growth in demand for office space has come about because businesses have been changing their growth strategies and now want to expand quickly. It is expected that this trend will continue for the rest of 2013, further fuelled by the fact that new office space is going to be limited until 2014, causing office rental rates to rise dramatically.
This comes in conjunction with figures that office space availability in Manchester had fallen to 16.4 per cent across all sectors in the second half of 2012. This is the lowest this figure has been since 2008.
Generally, net stock absorption had risen greatly in the second half of the year, especially due to the new Co-operative Group headquarters being built at One Angel Square. Standing at 72.5 metres tall, the building cost £105 million to construct and has now been sold on leaseback terms for £142 million.
Analysts hope that these positive trends will not only continue in Manchester for the rest of the year but extend into the rest of the north-west of England. With a fluctuating track record, investors and business owners will be keeping an eagle eye on the commercial property sector over the next few months.