Sheffield's office market experiences strong growth
15 January 2014
New figures have revealed confidence is returning to Shefield city centre's office market with the amount of grade A take-up in the last quarter of 2013 more than double the equivalent period in 2012.
And Rob Darrington, partner with Sheffield-based property consultancy Commericial Property Partners, said he expected the confidence to be maintained into 2014 while the demand for space could lead to a return for speculative development.
Darrington revealed that 21,814 sq ft of prime office space had been leased between October and December last year.
This was a marked increase from 2013, when 9,979 sq ft of grade A office space was let during the last three months of the year.
"This substantial increase in take-up is a sure sign that confidence is returning to the Sheffield office market, especially for primate office space," said Darrington. "This is excellent news and I expect this confidence to be maintained this year.
"Significantly, 79 per cent of the deals completed in the last quarter were below 5,000 sq ft and the demand came from private businesses, rather than the established legal, professional and financial sector. This again, is a telling sign that confidence in the UK economy is returning."
Darrington also revealed that the headline rents in the new build grade A developments, such as CTP's 3 St Pauls Place and the next phase at Sheffield Digital Campus, now range from £23-£25 per sq ft.
Existing grade A space in ring-road locations is now available at £13 per sq ft. Meanwhile existing refurbished buildings which are located in the restricted business core are now achieving rentals of £12 per sq ft.
Darrington added; "The increased confidence in the market at the moment will see quoting rents increase. It is expected that there will be evidence of rental growth on good quality stock in the city centre core early this year.
"2014 will be the third year in a row which has seen the market improving."
The combined city centre and out-of-town office take-up level in 2013 was 255,352 sq ft, compared to 189,889 sq ft in 2012. The highest total level of take-up in the last ten years was seen in 2009 where Sheffield saw 386,884 sq ft."