The Bristol office market has seen a promising start to 2024, with new city centre headline rents and improved take up across both the city centre and out of town markets, reports the Bristol Office Agents Society.
Bristol’s City Centre market saw 20 deals complete in the first quarter with total take up of 126,979 sq ft. This is a 54% improvement on the same period last year and is only just below the five-year average for quarter one.
This first quarter of 2024 has seen several larger deals cross the line with three deals in excess of 10,000 sq ft undertaken in the city centre. The largest of these was DAC Beachcroft’s commitment to 44,196 sq ft of the 6th and 7th floors of Tristan Capital Partners, and Trammell Crow’s Welcome Building. This was followed by the NHS’s move to 30,161 sq ft at the council’s 100 Temple Street, and Frazer Nash Consultancies expansion into a further 13,831 sq ft at Narrow Quay House.
Headline rents in the city centre have increased to reach a new high of £46.00psf, and with more deals under offer at this level it is expected to set the new tone moving through 2024.
The out-of-town market has also started the year positively with 12 deals crossing the line to give a quarterly take up of 54,118 sq ft. This is a 57% improvement on Q1 2023 and is in line with the five-year average take up for this period. The largest of these deals was Serco’s acquisition of 10,052 sq ft at 910 Aztec West.
This quarter marks another period in which no new office developments have commenced in Bristol. CEG’s EQ and Tristan Capital Partner’s Welcome Building will both complete within the next six months, and there are several comprehensive refurbishments underway, including APAM’s One Friary, Credit Suisse’s 3 Rivergate and CEG’s Crescent, which will provide space over the next 12 – 18months. However, looking further ahead the development pipeline is thin and schemes that start now will take at least 24 months to be developed.
Alfie Passingham, associate partner at Cushman & Wakefield commented “The success of EQ to date, and the recent pre-let at Welcome Building, is proof of the persistent demand for buildings amenitised with a combination of F&B, outdoor space, gym facilities and best in class accreditations. £50 per sq ft is very realistic for prime rents later this year.”
Hartnell Taylor Cook’s partner, Chris Grazier, added: “Despite tough economic conditions Bristol has demonstrated its resilience with the first quarter witnessing the return of large-scale occupier activity to the market further reducing the supply of high quality new, and refurbished space. This underlines the need for landlords to deliver further development over the coming months to capitalize on the positive occupier sentiment”.