Manchester named Northern Powerhouse’s best city for property investment

Manchester has come out on top as the best Northern Powerhouse city to invest in, according to new data.

Research from national commercial property consultancy Lambert Smith Hampton (LSH) found that two-thirds (68%) of property developers and investors identified Manchester as the preferred place to invest.

The reasons given by respondents ranged from the city’s variety of businesses and its large education talent pool to its favourable transport links.

Despite the positive outlook, more than one in four (28%) said that while the Northern Powerhouse was growing in potential, they do not think it will ever compete with London as a business location.

LSH’s head of the North, Matthew Scrimshaw, said: “For the Northern Powerhouse to thrive and succeed in the long-term, we still believe that the government’s money should be spent on Northern Powerhouse Rail (HS3).

“By focussing on connectivity within the region, rather than connecting northern powerhouse cities to the capital, it will prevent the most talented employees from being lost to London, while stimulating our regional economy further.”

According to LSH, Manchester’s popularity both with property professionals and as a business hub was reflected in its latest office accommodation take-up figures, which showed that of the 941,000 sq ft of new office space expected to complete by Q3 2017, 34% is already committed.

Further, the company’s research identified Salford as likely to become one of the biggest coworking hubs in the Northern Powerhouse region, in part because of popular office sites like the Tomorrow Building and Greenhouse, both at MediaCityUK.

LSH’s head of Northern capital markets, Abid Jaffry, said of the findings: “Since the recent referendum we have seen, rather unsurprisingly, that institutional investment has dropped off, but the baton has very much been picked up by overseas investors.

“They have been acquiring across the Northern Powerhouse and continue to do so.”

He continued: “Overseas investment has not just been directed at the prime end of the market but at a diverse range of opportunities from asset management to defensive plays.

“Manchester remains a key driving force with the larger lot sizes but large scale buys in key cities such as Newcastle and Sheffield are becoming much more commonplace and demonstrate a broadening of appeal in the Northern Powerhouse.”

The research formed part of LSH’s 2016 Northern Powerhouse Office Market Report.