Spotlight: 

Regional Office Market Report

Regional Office Market Report
Regional Office Market Report

21 September 2016, by Clare Bailey

A general shortage of new Grade A office development in the UK regions will provide a solid basis from which the UK can recover post-Brexit

■ We expect regional take-up for the end year to reach 10.5m sq ft, 3% down on the level recorded in 2015, but 15% up on the long term average.

■ Although the current uncertainty will inevitably affect business decisions going forward, we believe there are certain sectors including accounting and professional, which are likely to grow.

 

■ We expect to see rental growth in all but one of the key regional cities in 2016, with the biggest year-on-year rental growth in Cardiff and Birmingham in 2016 with 9% & 8% respectively.

■ We do not expect vacancy rates to rise significantly, as the heightened risk-aversion amongst developers, funders and lenders will lead to a reduction in development and refurbishment commencements in 2018 and beyond.

■ Proportionally, more is being invested in office markets outside London. The market outside London accounted for a 30% share as at the end of July 2016 (long-term average is 23%) as investors seek higher yields outside the capital.

 

 
Atria, Edinburgh

▲ Atria, Edinburgh (186,000 sq ft) - Purchased during Q1 2016 for £105m by Deka Immobilien, who were advised by Savills

Articles from Spotlight: Regional Office Market Report – September 2016

Review and Outlook

21 September 2016

Review and Outlook

We expect key regional cities, to once again, exceed their long-term average take-up

 
 

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Key contacts

Clare Bailey

Clare Bailey

Associate Director
Commercial Research

Savills Margaret Street

+44 (0) 20 7409 8863

 

Mike Barnes

Mike Barnes

Research Analyst
Commercial Research

Savills Margaret Street

+44(0) 203 107 5459

 

Steven Lang

Steven Lang

Director
Commercial Research

Savills Margaret Street

+44 (0) 20 7409 8738