Prime rents in Bristol city centre are holding firm at £42.50 psf, reflecting the resilience of the city despite economic headwinds strengthening.
Strategic real estate adviser Avison Young has just released its Big Nine review of the regional office market for Bristol, which shows that take-up in the city during Q3 2022 was up from the last quarter at 131,197 sq ft. This has surpassed the totals for the same period (i.e. the first three quarters) of 2020 and 2021, which were both impacted by the Covid pandemic and resulting national lockdowns.
Office availability is around a quarter below long-term average levels and supply of Grade A space remains very limited pending delivery of new developments under construction. Cubex’s 110,000 sq ft Halo is due to complete imminently but is already 88% pre-let to Osborne Clark and Deloitte. Following that, CEG’s 184,000 sq ft EQ and Umberslade’s 20,270 sq ft CARGO Work are both due to complete before the end of the year. The former is already 45% let to Arup and Payment Sense.
Notable deals in Q3 included West of England Combined Authority’s new 19,817 sq ft office at 70 Redcliffe Street, and Canada Life taking 13,260 sq ft at No1 The Distillery at an average rent of £37.25 psf.
The TMT & Creative sector continued strongly in the city, accounting for almost a quarter of take-up.
Paul Williams, Director at Avison Young in Bristol observes,
“As economic headwinds intensify, it is interesting to note that occupiers are still seeking out the best space which is driving demand for new Grade A accommodation, as well as a wave of comprehensive refurbishments of older buildings such as the Crescent Centre, 100 Victoria Street and Tower House. As occupiers consider their space requirements and focus on the need to attract and retain the best staff, the level of headline rent has become less of a factor in the overall relocation decision.
“Confidence remains high, with take-up levels expected to exceed the 5-year average in both city centre and out-of-town markets by the end of the year.”