Leeds office market continues to outperform

The market for office space in Leeds has continued to outperform a number of regional markets during Q2 2013, says the Leeds Office Agent’s’ Forum (LOAF). Total city-centre take-up reached 203,145 sq ft in the second quarter across 23 transactions, which was a jump of 260% year-on-year.

At the end of June, take-up of offices in Leeds city centre so far this year had reached 438,145 sq ft, which the Forum says is the highest level on record for the first half of any year since it begin compiling records a decade ago. The total compares with 212,288 sq ft at the half-way point in 2012 and is more than the 405,953 sq ft recorded for the whole of last year.

A spokesman for LOAF noted: “This is the strongest quarter in terms of city-centre take-up volumes since Q4 2003 and would appear to be best start to the first six months of any year in recent memory. Already, the total take-up in the first half of this year has exceeded the five-year average of 380,000 sq ft.”

The supply of Grade A office space in Leeds is now “severely restricted”, the Forum says, with only 235,000 sq ft of availability remaining in the city centre. Pre-lets are expected to become increasingly popular as a result.

The market for out-of-town offices in Leeds was also strong in Q2 2013, with healthy take-up volumes of 98,928 sq ft across 18 deals. This was down 40% from the second quarter of 2012, but that was an exceptionally strong quarter, recording the highest level of activity at 164,398 sq ft for a single quarter since Q1 2005. Out-of-town take-up at the end of H1 2013 had reached 195,835 sq ft compared with 220,419 sq ft for the first half of 2012.

Richard Thornton, director in Jones Lang LaSalle’s office agency team, noted that owner occupiers returned to the out-of-town market during the second quarter; six of the 18 deals recorded were freehold transactions, which he says demonstrates “the growing confidence in the occupier market in response to improving economic conditions”.