INSIGHT

The Big Nine

Quarterly update of regional office activity

Q1 2022

One Temple Quay, Bristol

DATA & ANALYSIS

Occupier data

Investment data

Occupier data

Investment data

Video

COMMENTARY

Charles Toogood

Principal and Managing Director, National Offices Team

OCCUPIER MARKET IN BRIEF

Following an extremely active Q4, take-up activity unsurprisingly reduced during Q1, with a total of 1.1 million sq ft let across the Big Nine markets. While this reflected a 40% decrease from the previous quarter, this is mainly down to take-up during the final three months of 2021 being so far ahead of the long-term average. Q1 take-up, therefore, fell just 17% below the 10-year quarterly average with the 5-year quarterly rolling average changing by just 0.2%.

“Demand for the best space continues to put pressure on headline rents, and as a result many Big Nine markets experienced rental growth during Q1 with the average net effective rent increasing by 3% in just three months.“

Mark Williams

Principal and Managing Director, Regional Investment

INVESTMENT MARKET IN BRIEF

Overseas investors dominated office investment in Q1, accounting for almost three quarters of total spend across the Big Nine markets.

During the first quarter of 2022, the Big Nine regional office markets saw office investment of £755 million, reflecting a 21% increase from Q4 2021 and a 25% uptick against the 10-year average. Three overseas deals completed in excess of £100 million which led to overseas investors accounting for 74% of total volumes across just six deals

“Future proofed, well-located, good quality assets with a strong tenant base proved to be popular, particularly those that meet net zero carbon investment criteria, promote occupier well-being, and fulfil expectations for positive rental growth.“

CITY ANALYSIS

Birmingham

2022 got off to a strong start with Birmingham’s city centre take-up showing a 9% increase on the final quarter of 2021.

Bristol

Bristol saw an extremely strong first quarter with take-up exceeding the 5-year average by 62%.

Cardiff

Cardiff had an exceptionally strong start to 2022 with city centre office take-up exceeding the 5-year average by 37% after more than a twofold increase on the amount of space let in Q4 2021.

Edinburgh

Following 3 strong quarters of take-up, as expected, activity in Edinburgh city centre declined in Q1 totalling 95,543 sq ft, which reflects a 34% decrease from the five-year average level.

Glasgow

Q1 2022 city centre office take-up in Glasgow totalled 82,270 sq ft, reflecting a 57% decrease from the 5-year average and a 5% decrease from Q4 2021.

Leeds

Take-up in Leeds city centre reached 123,463 sq ft during the first quarter of 2022, with take-up falling slightly below the level seen during Q4 2021.

Liverpool

Although take-up in Liverpool city centre was limited, The Out-of-Town market saw a significant Increase in take-up and transactional activity.

Manchester

During the first quarter of 2022 take-up in Manchester city centre totalled just 206,763 sq ft. Whilst this may well be a hangover from the frenetic end to 2021 it is reflective of a quiet time in the market as occupiers continue to wrestle with occupational needs and macro-economic influences.

Newcastle

Following an exceptionally strong final quarter, take-up in Newcastle city centre unsurprisingly slowed during Q1. However, take-up was still over 40% above the quarterly average level totalling an impressive 69,912 sq ft.

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