Savills forecasts rising office rents in Manchester
Savills is predicting an increase in headline office rents in Manchester this year as Grade A supply remains scarce and demand starts to pick up, reports Place North West.
Savills’ spring 2011 report into available office space in Manchester forecasts that headline office rents in the city will rise to £30 per sq ft this year from £28.50 per sq ft in 2010. Place North West quotes Savills director Patrick Joynson as saying that the imbalance between demand for institutional office stock in the city centre and supply of such property is poised to put “real upward pressure” on rents, especially as demand starts to improve.
“The real issue for Manchester now is finding a solution to the inevitable midterm shortage of Grade A space in the market,” Mr. Joynson adds. He notes that there are several developments in Manchester that could start in the next 12 months, although these all depend on a certain amount of pre-letting. In the meantime there could be an opportunity for refurbishment activity on older and larger properties in order to maximise their letting potential – and value, Savills says. The firm points out that while large floorplates remain in demand there is plenty of supply of smaller properties of under 10,000 sq ft. Place North West also reports that Savills expects office take-up for the year in Manchester to reach about 850,000 sq ft.
