Office pre-lets at major Leeds schemes buoy Q2 2015 take-up

Central Square, Leeds

According to figures from the Leeds Office Agents’ Forum (LOAF), 213,126 sq ft of office take-up was recorded in the city centre in the second quarter of 2015 compared with 103,729 sq ft in the same period last year.  At the half way point, 2015 city centre office take-up stood at 300,815 sq ft compared with 243,987 sq ft at H1 2014.

Of the 43 deals to complete in Q2 2015, the most notable prelets in the city centre were PwC who pre-committed to 49,650 sq ft at Central Square and Addleshaw Goddard who took 51,531 sq ft at 3 Sovereign Square.  These buildings will be ready for occupation over the next 12 months and will add considerably to the profile and attraction of Leeds to major occupiers.

The largest letting of existing office space in Leeds city centre was at 8 Park Row with Perform Media Services taking 7,664 sq ft of space.

According to the LOAF, office rental levels, as expected, are now edging forwards with established quoting rents of £27–£28 per sq ft for new space which still looks good value when refurbishments are being promoted at £24– £25 per sq ft.

Speaking on behalf of the LOAF, Michael Leonard from BNP Paribas, said: “We have seen healthy take-up in Q2 and are on course for another good year’s letting activity, above the long-term average. Market confidence is presently appreciably higher than at the start of the year, having finally secured further major pre-lets, and we can look forward to commitments being made by other requirements including BskyB, Call Credit and Npower.”

Jonathan Shires from CBRE, added: “Although Grade A office supply is continuing to dwindle, Leeds will benefit from the much anticipated completion of circa 540,000 sq ft of new space in 2016.  Despite the fact that a third of this space is already committed, Leeds is still very much open for business with several further major office refurbishments in the pipeline.  All of this will further add to the city’s attractiveness as one of the UK’s key business locations where real value is available.”

Activity in the Leeds’ out-of-town office market remained muted. The freehold acquisition of Marian House by Nationwide Window Cleaning service, which totalled 8,500 sq ft, was the largest sized deal to complete in the second quarter.

The Leeds Office Agents’ Forum was established by the leading surveying firms based in Leeds to collate and distribute definitive market data. Its members are BNP Paribas, Carter Towler, CBRE, Colliers International, DTZ, Eddisons, Fox Lloyd Jones, GVA, JLL, Knight Frank, Lambert Smith Hampton, Ryden, Sanderson Weatherall, Savills and WSB.