Manchester Office Space Market
March 1st, 2008 | by Simon Rattray |Despite the effects of the credit crunch, Manchester continues with a number of new, high quality office space developments. In fact, there is scheduled to be 120,000 square feet of grade ‘A’ office space to be completed in 2008.
The city’s office space market continues to perform well with 1.01 million square feet taken up in 2007 which was an increase of over 70,000 of 2006. One third of the take up was grade ‘A’ office space, with headline rents reaching £30 per square foot.
So it appears that Manchester property agents have plenty to be optimistic about. But with 1.3 million square feet of grade ‘A’ office due for completion in the next two years, they will plenty of deals that will need to be had to keep the vacancy rate down. Will the good times last for Manchester? Well critics will point to the fact that there are major developments in the city centre that have not experienced the occupancy levels enjoyed by other buildings such as Aurora and Zenith. The former is only occupied at one tenth of the total capacity.
So will developers get their fingers burnt in the next two years? Well the market will always require healthy competition, but the rule of thumb appears to be that if you build high quality developments in prestigious, sought after locations you will attract plenty of tenants.
It could be argued that the temptation is for developers to build schemes as fast as possible while demand is high, while often neglecting the quality or flexibility. There will always be winners and losers with regard to how the developments perform. Hopefully another good year in 2008 will ensure that overall the market will continue to perform well despite the macro economic turbulence.
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