City Spotlight: Leeds

Leeds is a major city within the regions and has enjoyed an abundance of positive activity over the last 18 months with 2017 seeing 3 records broken for the city:

1. It was the first year on record that office take-up surpassed the 1m sq. ft mark (88% higher than the 10-year average for the city).
2. Rents have reached £30 per sq. ft. with Cushman & Wakefield predicting this will increase, but will be dependant on new schemes being complete.
3. The biggest ever commercial letting was completed by the Government Property Unit (GPU) for a 25-year lease on 378,000 sq. ft at 7-8 Wellington Place.

Knight Frank’s research has reported that city centre take-up in Leeds was +133% from 2016 – 2017, with the biggest take-up being the GPU’s lease. The technology sector continues to play a strong part on the market’s activity, accounting for 16% of take-up during 2017. The increase in demand has unsurprisingly brought high investor appetite with 40% of last years investment volumes being from oversees buyers.

Cushman & Wakefield has reported that this year, take-up in Leeds reached above the cities five-year Q1 average with Q1 2018 seeing just under 192,000 sq. ft let – the strongest first quarter since 2013. Two of the largest top four occupier transactions in the regions for Q1 2018 were in Leeds: Walker Morris 76,000 sq. ft lease at 33 Wellington Street and Dart Group PLC 48,300 sq. ft lease at The Mint.

A major regeneration project for the city is in the South Bank area. The project aims to double the size of Leeds city centre, proposing activities to regenerate 253 hectares of land, creating 35,000 jobs and over 8,000 homes. South Bank has a proposed location for a station for HS2 – making the area easily accessible, delivering economic growth, new business and leisure opportunities. This development will transform the city entirely!

There are several plans in development and more being submitted for planning permission but only one scheme is currently due to complete in 2018: CBRE Global Investors refurbishment of Park Row. This lack of supply and increase in lettings is leading to pre-lets, refurbishments and low vacancy rates.

The city of Leeds finished 2017 with new records and has started 2018 strong, looking forward to watching the city develop further as new plans unfold.