Research from national commercial property consultancy Lambert Smith Hampton (LSH) has highlighted record levels in Newcastle’s out-of-town office market, with transactions up 50 per cent on the same period in 2016.
The Q1 2017 Newcastle Office Market Pulse, which provides investors, occupiers and developers with detailed insight across the city, found that, despite the weak city centre performance, Newcastle’s out-of-town office market saw a notable increase in office take-up.
With a total of 210,502 sq ft of newly let space, take-up was dominated by locations outside of the centre of Newcastle, with these lettings accounting for 84 per cent of the total volume of space transacted in the first quarter. City centre take-up saw an 11 per cent drop in this last quarter, compared with the previous quarter, with the supply of Grade A stock across Newcastle city centre continuing to dwindle. As a result, one grade A letting took place in this quarter, a letting of 19,200 sq ft at the St Nicholas Building to Frank Recruitment Group.
Michael Downey, Office Agent at LSH Newcastle, commented: “In the first quarter we have experienced a significant increase in new lettings of office space on the periphery of the city centre, indicating there is still appetite for commercial space within the Newcastle market.”
“There is, however, a clear slowdown in city centre performance as a result of dwindling stock. With headline rents currently at £23.00 per sq ft and less than one year’s Grade A supply currently available in the market, we should begin to see renewed appetite from developers.”