8th July 2019
Bristol Offices Mid-Year Market Report
Bristol Offices Mid-Year Market Report: July 2019
Take-up of office space in Bristol in the first half of 2019 was subdued in comparison with recent years, primarily as a result of a lack of good quality stock in the city centre ready for immediate occupation and, in some market sectors, by ongoing Brexit uncertainty. However the strong level of named enquiries and the number of viewings on existing space point to an underlying strength in the market and a number of significant transactions including pre-lets are in solicitors’ hands and should transact during H2.
Demand remains strong in the co-working/serviced office sector which accounted for circa 31% of H1 city centre take-up, together with the TMT and financial services sectors.
Significant H1 transactions included the acquisition by Spaces of 35,000 sq ft at Programme in the city centre. In north Bristol, St James’ Place acquired 40,760 sq ft at 2610 Aztec West and Elbit Systems acquired 12,760 sq ft at 600 Aztec West.
Both the city centre and out of town markets continue to suffer from a severe lack of new or newly refurbished Grade A accommodation. This will be partly alleviated by two new Grade A developments under construction in the city centre, both of which are due to complete in 2020. At The Distillery, Glassfields, Royal London Asset Management is on site with 90,000 sq ft in three buildings and at The Assembly on Temple Way, AXA is on site with a first phase building comprising 200,000 sq ft.
In addition high quality new refurbishments are underway at The Landing on Redcliff Street by L&G and at Merchants House by Bellborough Ltd. CSL Limited is advancing proposals for circa 37,500 sq ft of high quality refurbished accommodation at 37-39 and 41 Corn Street.
In north Bristol, further refurbishment projects are planned as a result of the recent success of Buildings 600, 730 and 800 Aztec West where lettings were achieved following speculative refurbishments.
The top headline rent achieved in Bristol city centre for brand new Grade A accommodation now stands at £34.50 psf, with both new speculative developments currently underway guiding in excess of this level.
In north Bristol the letting of Building 600 Aztec West in Q1 2019 set a new headline rental high for this cycle at £23 psf. In addition, the level of incentives granted in both the city centre and north Bristol markets has fallen as a consequence of reducing supply.
|Office Take-Up||367,000 sq ft|
|Office Supply||775,000 sq ft|
|Headline Rent City Centre||£34.50 psf|
|Headline Rent Out of Town||£23 psf|
For up to the minute advice on opportunities in Bristol, contact Simon Price who leads our Bristol office agency team on 0117 317 1084.