Demand for high-quality office space in Manchester city centre is expected to intensify in 2025 unless the development pipeline increases, according to a commercial property expert.
Last year, Manchester city centre recorded its highest figure since 2022’s 1.21 million sq ft with total transactions for last year amounting to 1.22 million sq ft surpassing the five-year average.
The remarkable figures from the Manchester Office Agents Forum, which is made-up of property agents across the city, reveal that during Q4 in 2024 there was a total of 280,598 sq ft of office accommodation let across 51 deals in Manchester city centre.
The largest deal of last year was the Bank of New York Mellon Corporation acquiring 200,000 sq ft at 4 Angel Square.
In 2024 on a proportion basis, 44% of the total deals was for space of over 20,000 sq ft which accounted for 536,180 sq ft of office accommodation.
Significant deals in the final quarter of last year included Channel 4 taking 12,200 sq ft on the eighth floor at St Micheal’s to double its presence in the city, and Virgin Media O2 committing to 100,000 sq ft of space at HBD and Greater Manchester Pension Fund’s Island scheme on John Dalton Street.
Steve Brittle, Partner at leading property consultancy Fisher German which has an office in Deansgate in Manchester, said the impressive number of deals in 2024 reflected the high-calibre of office accommodation in the city – and he said that competition for Grade-A space will increase if the development pipeline slows down.
He said: “Beating 2022’s previous high annual figure of office space lettings emphasises the faith in Manchester city centre’s office market.
“2024’s figure was also a significant increase compared to 2023 when the total lettings figure was below the one million sq ft mark.
“Manchester city centre’s office market performance in 2024 was encouraging to see especially with take-up exceeding the five-year average as well as demonstrating a strong post-pandemic recovery.
“It also highlighted the continued demand for best-in-class office accommodation that incorporates Environmental, Social and Governance (ESG) credentials and amenities for occupiers.
“If this can be maintained in the development pipeline then Manchester city centre’s office market will sustain its upward trajectory otherwise it could affect the city’s ability to attract high-calibre businesses if there isn’t the accommodation available.
“The letting to the Bank of New York Mellon Corporation at 4 Angel Square in 2024 highlights the attraction and pull of Manchester as a city to corporate occupiers wanting to consolidate and expand their presence here.”
The South Manchester Market concluded the final quarter of 2024 with 78 deals across 78,451 sq ft which demonstrated that occupiers were moving into smaller but better accommodation.
The final figure for the year reached 332,472 sq ft which was significantly below the 547,195 sq ft achieved in 2023.
In Salford Quays and Trafford, the office market recorded a take up of 38,246 sq ft for Q4 of 2024, bringing the total figure for the year to 156,725 sq ft. The number of deals for Q4 increasing to 20 from 15 in the previous quarter.
Steve added: “It is encouraging that there is still demand for offices outside the city centre, as these areas have much to offer particularly for smaller businesses looking to move into an office for the first time or expand.”
