Office take-up in the Cardiff market reached 121,000 sq ft in Q1 2022, the highest Q1 take-up since 2019, and 214% above Q1 2021, according to the international real estate advisor Savills.
Grade A take-up accounted for three quarters (74%) of total take-up in Q1, a 150% increase in the number of Grade A deals completed compared to Q1 2021, highlighting the significant demand there is for high quality offices.
Total supply increased in the first quarter of 2022 to 1.65 million sq ft which represented a 16% increase from Q4 2021. However, with a limited development pipeline and a strong start to 2022 in terms of take-up, Savills predicts that supply in the market will reduce in the remaining quarters of the year.
The TMT sector was the most active sector in Q1 2022, accounting for 60% of overall take-up. This included the 65,000 sq ft letting to BT at Capital Quarter, the largest letting in Q1. This is an excellent start to the year for the sector, with total take-up of 72,000 sq ft surpassing the annual 2021 total by over 200%.
While there was no change in the prime rent in Cardiff in Q1 2022, Savills expects the prime rent to grow for the first time in six years in 2022 with current forecasts predicting that the prime rent could reach approximately £30.00 per sq ft by the end of the year.
Gary Carver, Director in the office agency team at Savills Cardiff, says: “This has been an excellent start to the year for the Cardiff office market. Whilst hybrid working is likely to remain, there is a clear demand for high quality office, sustainable office accommodation, with companies keen to improve the quality of space and design of their workspace in order to attract staff back to the workplace more regularly.”