· Manchester city centre quarterly take-up fell to 135,000 sq ft in Q2. The largest deal by far was the 21,500 grade B letting to the Money Plus Group at Bruntwood’s refurbished Riverside on New Bailey Street.
· Current requirements suggest that the forecast of annual take-up in 2012 should be revised up to 850,000 sq ft. This includes “Project Digital”, an undisclosed US technology corporate, which is set to take up to 100,000 sq ft of grade A space in 2012, progressing to an eventual total of around 170,000 sq ft.
· The Co-op is expected to move to its new headquarters later this year and vacate various grade B sites, totalling around 380,000 sq ft. Grade A availability is likely to fall in 2012, however, prompting prime rental incentives to do the same.
· Any pre-lets signed in 2012 are likely to require at least a £30 per sq ft rent for them to go ahead. The large grade A floorplates to be delivered at the 1 St Peter’s Square development in 2014 are likely to increase prime rents in 2013 via pre-lets also.
There was a greater transactions total in the out of town market in Q2, with a 125,000 sq ft pre-let to Think Money (formerly Gregory Pennington) in Old Trafford. The physical move is expected in late 2013 and will consolidate the firm’s operations from various sites in Salford Quays.
Rob Yates, Director of Office agency at DTZ in Manchester comments: “The large number of smaller transactions in Q2 demonstrates the indigenous strength of the City’s occupier base. The majority of activity was in the Grade B sector of the market where availability is greatest. Disappointingly only one transaction was over 10,000 sq ft – Bruntwood’s letting of 21,500 sq ft to Money Plus Group at Riverside.
We expect Q3 and Q4 2012 to show improved levels of activity. There are a number of deals due to commit plus larger transactions to Bupa (160,000 sq ft) and Jacobs (90,000 sq ft) to come to fruition. We expect the final take up figure for 2012 to be around 700,000 – 800,000 sq ft.”
