Member Article

Upbeat end to 2018 says Offices Group

Take-up of office space across the North East and in Newcastle’s city centre during 2018 was up by 35% compared to 2017 and was the second best year since 2011 when the Offices Group was formed.

“This suggests a very buoyant picture but it does come with a caveat that take up out of town figure for the last quarter was down and there is now evidence that tenant demand has slowed due to Brexit uncertainties,” says Chris Pearson, Gavin Black & Partners. “Further the same quarter included a letting at Newcastle’s Civic Centre involving 63,350 sq ft which otherwise would have meant that the take up number would have gone down albeit only slightly.”

The fourth quarter of 2018 saw 17 lettings in the city centre totalling 36,499 sq ft and 23 out-of-town lettings totalling 80,592 sq ft, in all totalling 139,091 sq ft which includes a change of use deal of 22,000 sq ft.

This brought the total let space during 2018 to 815,715 sq ft compared with 2017’s total of 708,413 sq ft.

Mr Pearson adds: “The majority of tenant demand is now under 5,000 sq ft with take up focused on the best refurbished buildings particularly those that are ‘amenity rich’ not just in terms of fit-out and overall work place ambience but communications and nearness of shops and leisure facilities. An example of success is Hanro’s redevelopment of 71 Grey Street which alone had five lettings in the last quarter.”

Patrick Matheson, partner, Knight Frank, letting agent on the 71 Grey Street project, says the success of the scheme “clearly demonstrates why Landlords should be investing in the right areas and bringing their buildings to the right level in order to keep up with occupier needs and trends”.

He continues: “The building has been immensely successful, with all space either let or under offer ahead of Practical Completion at new headline rents for Grey Street. It has attracted very high profile occupiers from both tech and professional services sector, all attracted by the unique style of the refurbishment and the level of amenity and community which was injected into the refurbishment.

“This demonstrates occupiers’ emphasis on taking the best space allowing them to focus on staff retention and enabling them to attract more when necessary.”

The Offices Group comprises Gavin Black & Partners, Knight Frank, Lambert Smith Hampton, Naylors, Sanderson Weatherall, Cushman & Wakefield, GVA and Bradley Hall.

This was posted in Bdaily's Members' News section by Chris Dobson .