Manchester has the highest office rent costs outside of London
Owing to sky-high demand, the average rent for office space in the heart of London has reached £55.34/sq. ft. This has left many enterprises searching for commercial space in other metropolitan cities, one of which is proving to be particularly popular – Manchester.
With commercial space in Manchester now costing double of that available in Liverpool, it is now the most expensive city in the UK behind London in which to lease an office. The city has emerged as a veritable economic hub in recent years; the BBC’s decision to move northwards to MediaCity UK has regenerated the Salford Quays area, and many major corporations such as Thomas Cook, Guardian Media Group, ITV and Google now have a presence in the city.
The arrival of such powerhouse businesses has created a surge in demand for square footage, which has driven prices upwards substantially. It is now estimated that commercial space in Manchester is as much as 50 per cent more expensive than other northern cities. While “Northshoring” – or moving northwards to escape London’s high rates – was once a move conducted to save money, companies can now expect to pay like-prices to secure office space in Manchester.
Supply and demand in “Cottonopolis”
Manchester may have earned a reputation for it’s cotton mills and industrial production in the 19th century, but today, the city is a vibrant hub of tourism, commerce and media.
With companies such as Etihad Airways adidas and Siemens having their European headquarters here, the commercial landscape of the city has been dramatically altered. The average price for office space now sits at £32/sq. ft., although market analysts predict it will reach as much as £34/sq. ft. by the year’s end. Other analysts have revealed that demand for office floor space in Manchester has risen by as much as 166 per cent, and given that this interest from prospective occupiers and investors currently outstrips the supply, it is easy to see why prices continue to rise.
Manchester isn’t the only city outside of the capital commanding higher rates; in Birmingham, businesses can expect to pay an average of £31.50/sq.ft, while those in Aberdeen will pay on par with those in Manchester, parting with £32/sq. ft.
However, it’s not all bad news for businesses; for companies looking for a less expensive alternative north of London, Liverpool remains a viable option, with the rental rates for office space just over half that of Manchester at just £18/ sq. ft.
Written by: Steven Jones on Wednesday 04/11/2015