Prime office rents in Cambridge now stand at £41 per sq ft, the latest business space research from property consultants Bidwells has confirmed.
Bidwells Research Director, Sue Foxley, said the figures mean it’s time to start thinking differently about the office market outside of London.
Foxley believes Cambridge is now emerging as a “core market” in the same way London sub-markets have in the last decade.
She said: “The restructuring of the financial sector in the late 80s and 90s set the tone for the City and latterly Docklands office market for years to come. In more recent years we have seen a shift to other high growth industries, with sharp rental increases being seen in areas such as Shoreditch.
“Cambridge is seeing the same dynamic, driven by its pronounced exposure to the emergence of the UK’s leading science and technology companies. Geography is increasingly irrelevant. The longstanding delineation of London, the South East and other regional markets is becoming outdated in the evolving economic landscape.”
Research undertaken recently for business and academic member group Cambridge Ahead by the Centre for Business Research show a sharp increase in business growth over the last 12 months, with global turnover expanding 14.4% and global employment growth of 9.2%.
Foxley added: “This recent expansion of turnover ahead of employment suggests productivity gains, allowing companies to compete for high skilled staff and push business space affordability limits, resulting in the £40 psf rent milestone being breached.
Bidwells latest research found a prime office rents upturn of 7.9% over the last year, reaching levels previously not expected until 2022.
Will Heigham, Partner and Head of Office Agency at Bidwells, said; “Rents in the city and its surrounding prime parks are now well ahead of other regional UK office centres and we expect them to continue growing with the city’s continued success.
“The emergence of Cambridge’s world-class knowledge economy cluster, supported by an internationally renowned University, is allowing the high-growth companies located here to compete more strongly than ever for the top talent and best business space. We now see rents reaching £44 per sq ft by 2023.”
Over 80% of Bidwells’ work is concentrated in the ‘Golden Triangle’ of Oxford, Cambridge and London, including sector-leading work in the science & technology, and education sectors.
