Despite a lack of large deals in Bristol during the second quarter of the year, demand for office space remained steady with lettings of smaller suites holding up well, according to new research.
The latest data from national property consultancy Lambert Smith Hampton showed that city centre take-up in the three months between March and the end of June this year was 141,670 sq ft, which is slightly lower than the five year average.
Notably, there were few sizeable deals in Q2, with the largest transaction in the city centre being the letting of 13,480 sq ft to Jordan’s, at Orchard Street’s Temple Back.
Take-up at the smaller end of the size bracket remained healthy, however, with a total of 21 deals in the sub 10,000 sq ft category. Total office take-up for the quarter across both the city centre and out of town markets was 200,669 sq ft, which is down on the same period last year.
LSH Head of Office Peter Musgrove attributed the dip to the lack of availability across the city.
“There is little doubt that the ever shrinking supply of good quality space in Bristol is having an impact – firms are facing an increasingly limited choice,” he said.
Firms were looking at alternative options to moving, he added, including renewing leases, taking expansion space in an existing building or leasing satellite offices. “But this isn’t sustainable in the long-term. Companies need better accommodation to suit their brand and employee aspirations – staff retention is key,” he said.
“In effect, we are seeing the conditions for a ‘perfect storm’; the demand is there, supply is shrinking and there is little new development.”
“Castleforge’s One Cathedral Square is being fully refurbished to provide grade A space this summer, but there are few other developments in the pipeline. Over the next two quarters, we are likely to see demand increase and a return to pre-lets,” Peter said.
The construction of 95,000 sq ft of Grade A office space at Cubex’s Aurora, part of the wider Finzel’s Reach scheme, remains the only speculative development in Greater Bristol.