A new report by national property consultancy, Lambert Smith Hampton (LSH), says that Leeds may have to turn away any organisation looking for a large office base in the city of 35,000 sq ft or more due to a shortage of immediately grade A office stock.
Lambert Smith Hampton’s Office Market Pulse report confirms that after bumper take-up in the first half of the year, grade A stock is down to 226,000 sq ft – just one year’s supply and crucially no grade A space with a floorplate over 35,000 sq ft that is currently available.
Adam Varley, head of office agency at LSH in Leeds, said: “Combined city centre and out of town take-up in the first half of 2013 was over 633,000 sq ft, up 48% on the same period last year. This is really good news for Leeds and, when viewed with the positive UK growth figures, suggests the future is bright.
“But we need to be very careful. The city cannot afford to get into a position where it cannot meet the needs of growing existing organisations or new businesses looking to move to the city. We need more grade A space or the city could stagnate in 2014.”
The report also shows that lack of grade A space is driving up rents in key locations which may lead to a return to speculative development.
Varley added: “Out of town rents rose to £16.50 per sq ft in the last quarter. This was in direct response to an undersupply of grade A, large floor plate buildings.”
