Manchester has been ranked 10th in Colliers International’s latest European Cities of Influence report released at MIPIM this week. The city ranked 10th overall in the research while being placed fourth in Colliers’ rankings of mid-sized cities with a population of between two and five million people.
Key socio-economic factors in which Manchester impressed included boasting a strong talent pool mainly because of the future talent base offered by its top tier universities, economic output, workforce catchment area, employee quality of life and employer costs.
The analysis by Colliers showed current prime central business district (CBD) headline rents in Manchester at £35 per sq ft per year with an average CBD headline rent of £27 per sq ft per year and prime CBD yield currently five per cent.
Andrew McFarlane, director and head of the North West for Colliers International, said: “Manchester continues to boast one of the highest student populations in Europe with two of the UK’s largest universities and one of the largest medical campuses in western Europe.
“The city is increasingly capable of retaining this future talent as a major force in the Northern Powerhouse, which is helping to drive greater levels of investment into the city.”
The Cities of Influence report reviews and ranks cities based on their occupier attractiveness, availability of talent, and quality of life factors alongside economic output and productivity. It ranked London as the most attractive city in Europe for a second year running, with Paris, Madrid, Moscow and Birmingham making up the rest of the top five.
This year’s new extended version of the report looked at 50 major European economic hubs – building on the 20 cities covered in the inaugural report – providing a broad geographic coverage of European markets that are of global, regional and national importance.
Peter Leyburn, EMEA Director of Client Services at Colliers, added: “Office occupier strength is the engine room for a city economy and as a driver of all other forms of real estate demand: be it retail (and thus logistics), hotels, leisure and residential. Occupational strength will also help drive rental growth and longer-term this is the most important driver of capital value – especially in an environment where yields do not look capable of compressing any further in the vast majority of markets. So this analysis should be a good marker for where investment capital should go.”
“Urban transformations and new infrastructure are also very strong drivers of investment growth. Given we are now approaching the peak of the investment cycle in terms of pricing, and thus volumes, the logical evolution of the cycle is to see a redistribution of capital into cities, illustrating a strong basis for occupier growth alongside those with new key infrastructure changes,” said Richard Divall, Head of Cross Border Capital Markets at Colliers International.
