Bristol city centre office availability is now at its lowest since early 2007, following take up of 491,000 sq ft during 2015.
The 110 deals concluded in the city centre during the year was the 4th highest number of deals in the last 10 years. Take up was dominated by the TMT (Technology, Media, Telecoms) and professional service sectors leaving only 860,000 sq ft of office space immediately available in the city centre by February 2016.
Commenting on the office market take up figures, Andy Smith, associate at the Bristol office of Knight Frank, said: “2015 was always going to be overshadowed by record take up in 2014 and though take up was lower than the five and 10 year averages both in and out of town, further analysis shows a continued depth to the market.
During 2015 prime city centre rents remained stable at £28.50 per sq ft, with no pre-let activity. Positively there were eight deals involving Grade A office accommodation, totalling 64,700 sq ft.
The market for city centre secondary space however was “booming”, with rental increases of 30 to 40 per cent on refurbished accommodation.
Andy Smith added: “An additional 160,000 sq ft of office space was sold for alternative use, such as housing and student accommodation during last year. We estimate that around 1 million sq ft has been removed from the office market for alternative use in the last 24 months.”
Bristol’s out of town market saw 292,430 sq ft of take up took during in 2015 and current out of town availability stands at 428,500 sq ft – down from an all-time high of 622,000 sq ft in Q4 2013. Prime rents remained static at £21.00 per sq ft.
“The 36,000 sq ft pre-letting to ALD Automotive in the fourth quarter of the year was the first out of town pre-let for several years.” said Andy Smith.
Looking forward, Andy Smith said there were several larger indigenous Grade A and B requirements which were expected to land in Q1 2016. “Of note already has been the letting of 80,000 sq ft to EDF,” he said.
“The development of the 95,000 sq ft Aurora by Cubex and Palmer Capital represents the first speculative development in the city centre for three years.
“Meanwhile an ever tightening of supply will mean the Grade B market will continue to see rental growth and compression of incentives. This has resulted in several Grade B refurbishment projects kicking off in Q1 2016.”
