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June 13, 2012

Manchester rental prices predicted to outpace inflation

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Manchester office space rental prices are expected to outpace the inflation rate, commercial premises experts have predicted, as the city grows to become a more costly place to conduct business.

According to Savills, office rents in Manchester city centre have already gone up more than double the inflation rate over the past 12 months, with even more growth to be expected over the coming months. The estate agent’s latest market report for Manchester found that headline rents are being pushed up by a dwindling office accommodation supply.

While Manchester’s vacancy rate has gone down to 11.7 per cent – which equates to eight out of every nine square feet of city centre space taken up – the remaining accommodation is of lesser quality.  Less than 750,000 square feet of grade A office space remains available within the city,  and with demand levels spiking without any significant new construction in the development pipeline, Savills remarked that the balance of power is set to shift back towards landlords and away from tenants.

The property expert’s report fund that headline rents are now £30 a square foot in Manchester, which is 7.1 per cent higher than 2011’s top rental price. Savills Manchester head, Patrick Joynson, remarked that the remainder of office stock still available could quite easily be gobbled up by any number of substantial corporate requirements that are circling like a pack of hungry sharks, which could place even more upward pressure on rental prices.

Mr Joynson indicated that Savills expects these trends to persist over the coming two years, though pre-letting activity will most likely go on being more competitive.

June 10, 2012

Think ahead when it comes to choosing office accommodation

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When it comes to choosing office accommodation for your business, you’d best think ahead in order to avoid any unpleasant situations down the road, experts warn.

For many firms, it’s all too easy for the issue of commercial premises to slip through the cracks. However, it’s crucial that businesses review their lease events and office space requirements on a regular basis.

Experts say that the best way to accomplish this is to keep in mind what your needs for the future will be in relation to your office space requirements. Keep this in mind as you go about your day-to-day business, as it can all too easily be lost in the shuffle of the daily grind.

Some businesses tend to go through offices much more swiftly than others, but chances are even a sole proprietorship may need to go on the hunt for office space at least once or twice over the years. While it may seem daunting to have to face building, buying, or even leasing an office, there are things you can do to prepare that will make it less stressful, such as keeping in mind the entirety of your occupational costs – it’s no good if you get a nice low headline rate if there’s no nearby car parking for employees, after all.

Another thing you’ll need to keep in mind is whether or not you’ve got an option to break your lease. This has grown to be common practice with many larger firms, and these tenants have the opportunity to break their lease if certain criteria are fulfilled during a certain period of time, giving occupiers the flexibility to relocate in the event of it becoming necessary.

June 8, 2012

Central London demand at highest level since 2009

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Central London’s office space market has picked up recently, with demand rising to the highest its been since 2009 as a result of interest finally catching up with the diminished supply of city office space, Jones Lang LaSalle recently found.

The commercial premises consultancy found that total demand figures stand at 12.6 million square feet currently after potential tenant demand increased by more than 12 per cent over the last year. JLL City agency head, Dan Burn, remarked that central London is shaking off its torpor as signs of life begin to creep back in – an innervation he attributed to the technology, media, and telecoms sector expanding.

While things are indeed looking up, it’s not all coming up roses. Demand was still under the 10-year average by five per cent, JLL warned, leading many to believe that the eurozone crisis and ongoing economic uncertainty have left firms reticent to relocate to new office accommodation, which means that leasing volumes are remaining modestly low.

It’s true that JLL expects that new office take up will be stagnant in the shorter term, the property consultancy did say that it found some evidence that select firms were regaining their lost confidence and have started to actively seek new opportunities. Mr Burn said that JLL has begun to see indications that 2012’s second half could have more activity in store for it than the first six months of the year, as quite a few quiet discussions have begun to take place on both existing office developments and those slated for completion in the immediate future.

June 6, 2012

Manchester rents beginning to see signs of recovery

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Industry experts have begun to report that office space rental prices in Manchester city centre have shown signs of recovery.

A new regional office market report released by Knight Frank says that prime headline rents for office space in Manchester are undergoing a recovery, especially in light of the 6,820 square foot letting of Brown Street’s Chancery Place by insurance firm QBE.  The insurer is understood to have agreed to pay £30 per square feet of office accommodation, leading rental growth in Manchester to outperform other regional markets in 2012’s first quarter.

Prime city office space rents increased to £30 from £28 during the first three months of the year, with net effective rents arriving at a figure of £23.50 by the end of that period of time.  Knight Frank also reported that there was nearly 170,000 square feet of commercial office space let in Manchester city centre in the first three months of 2012, which was an increase of 34 per cent in comparison with 2011’s first quarter figures.

Manchester left its regional rivals in the dust, with Newcastle, Sheffield, Liverpool, and Leeds seeing much lowered take up numbers, with only Leeds approaching Manchester’s figures with less than 156,000 square feet.  The second-hand office accommodation market was strong, as the only grade A space let out of the 61 transactions in Manchester was the one at Chancery House.

June 1, 2012

Streets Heaver doubles up on commerical premises in Lincoln

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Streets Heaver, an clinical and administrative software supplier for NHS practices and independent hospitals, recently announced that it will be doubling up on its Lincoln commercial premises.

The software supplier is relocating to large, three-acre landscaped office space complex Streets at The Point off Whisby Road, thanks to the work of Hodgson Elkingon LLP, chartered surveyors.  Based in Lincoln for two and a half decades, Streets Heaver has invested in expanding its commercial office space to about twice the amount it currently has at its Doddington Road headquarters.

The larger office building will pave the way for the planned growth of the firm’s sales and marketing, support, testing, and software development teams.  Currently home to 26 staff members, Streets Heaver is planning a recruitment drive in the wake of winning several new key contracts and is scheduled to relocate to The Point this coming July.

The software development company’s managing director, Paul Heaver, remarked that the new office move is representative of a serious investment on the part of Streets Heaver.  The firm is committed to its expansion plans, and is keen to both maintain its high standards while growing its business to new heights, Mr Heaver added.

Hodgson Elkington partner, Dan Race, also commented on the new office accommodation deal, remarking that it was gratifying to see yet another Lincoln-based business relocate to such a successful and established development.

Streets Heaver joins several other occupiers already at The Point, including The Upper Witham Internal Drainage Board, BT Local Business, and accountancy firm Nicholson’s.

May 31, 2012

£19 million Wakefield One completed, says Morgan Sindall

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The Wakefield Metropolitan District Council’s new £19 million headqurters, Wakefield One, has reached completion, according to developers Morgan Sindall.

The new four-storey building, located directly next to County Hall, will provide office accommodation for the 1,200 council employees that will work there.  Based on a design by architectural firm Cartwright Pickard, the complex boasts 123,000 square feet of office space and features extensive glazing, a central atrium, and an open-plan design.

The newly completed office development is the next step of the Wakefield Merchant Gate Masterplan, a £140 million city regeneration project with an end goal of a new urban quarter within Wakefield that will stretch for 17 acres once completed.  The office project’s completion has placed Morgan Sindall in the enviable position as the front-runner for prestigious Building Excellence Awards, which are handed out by the West Yorkshire Local Authority Building Control.

The awards recognise developers and builders who meet high workmanship standards in residential construction and commercial office space projects.  There are only two other schemes in the running for the award for the same category a Wakefield One, with the final announcement coming sometime next month.

The English Cities fund, which is a partnership  appointed Morgan Sindall to the scheme between the Homes and Communitis Agency, Legal & General Property, and Muse Developments, an urban regeneration and property developer, appointed Morgan Sindall was appointed to the scheme.  Morgan Sindall area director, Chris Brown, said that the new civic offices the developer has constructed will fit nicely within Wakefield city centre’s regeneration master plan.

May 30, 2012

Worcester City Council receives plans for new development

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Worcester’s Shrub Hill area may soon be home to a new development, provided Worcester City Council signs off on the new office space planning put forward by  major commercial premises developer Sheriff’s Gate Ltd.

The new scheme includes not just residential and office space but several other amenities, such as an ice rink, a bowling alley, a cinema, in addition to several dining and retail outlets as well.  As many as 600 new residential lots could be created and have houses built upon them, if approval by the local authority is granted, and a new 30,000 square foot building would be constructed, with more than two of its floors being reserved for office accommodation, while an additional 35,000 sq ft building would be made available for local entrepreneurs and start-up businesses.

If given the green light by the council, the development could be completed as soon as the 2016-2017 financial year and would bring 900,000 sq ft of mixed use space for visitors, residents, and local businesses, boasting student/support worker apartments, a hotel with 96 rooms, an elderly care village, and a childcare centre.  The exact site of the development would be in close proximity to Shrub Hill Train Station, stretching between Tolladine Road on one side and Sheriff Street on the other, and could be the single most ambitious regeneration project ever undertaken in Worcester, one spokesman for Sheriff’s Gate Ltd said in a recent statement, with the spokesperson adding that the firm, which is based locally, having a desire to rejuvenate the area in order to benefit the city.

May 29, 2012

Will hot desking reduce the amount of redundant office space?

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A lot of companies are still struggling to recover from the recession and the latest crisis to hit the Eurozone is doing nothing to speed up the process.

Small businesses in particular are looking for more inventive ways to save money and some are turning to hot desking. The majority of firms pay for more office space than they actually need, and this space can be expensive, especially if you’re based in the City.

The advent of mobile technology meant it was no longer necessary for everybody to undergo the long commute into the office each morning. People can work from home just as efficiently as if they were physically present in the office. But of course that means a lot of office space is siting idle and that’s not good for the company finances.

Hot desking is the new buzz term for sharing office space. Basically, you cut down on the number of work stations in use on a daily basis, thereby needing less overall space. This should be reasonably easy to set up. Employees ‘share’ a desk so providing you set up a rota showing who works from home when, it should work out very well. Employees will love the idea!

If you’ve already decreased your headcount, but not your office space, you could consider renting work stations to the a freelancer of small business owner who needs an office base. As well as bringing in some welcome extra income, you could also be helping a new business get off the ground.

May 28, 2012

Report urges developers to consider smaller cities

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A new report urges developers to consider smaller cities when it comes to selecting sites for new commercial office space construction.

Urban policy think tank, the Centre for Cities, found that smaller-sized cities – especially those in the south – had seen a remarkable lack of new office space development as of late.  Areas such as Cambridge and Reading have been lagging behind in the office capacity department, the report said, even though their economies have been strong, yet there are much less robust markets, like those in Bolton and Blackburn, have experienced a sudden swell of available commercial premises.

The Making the Grade report discovered that development companies had a bias against smaller cities because they considered larger ones to have stronger demand, higher rental values, and a larger number of potential The think tank’s report Making the Grade found developers were biased towards large cities because these offered strong demand, a larger existing pool of potential occupiers and higher rental values.

There should actually be more office development  in smaller cities – theoretically – due to their stronger economic growth.  However, land supply and planning system constraints were limiting this, it said, with the most telling result being that development firms are sometimes unable to increase the amount of additional space in locations that there is potential for growth and high occupier demand.

Office space planning systems need to be modified in order to support additional office development instead of hindering it, the report said, especially where the level of existing demand has been high.

May 25, 2012

Odd mismatch between demand and supply in UK

There’s a bizarre, puzzling mismatch when it comes to available office accommodation in the UK, with some of the fastest-growing towns suffering from office space shortages while areas with weaker economies have experienced a perplexing boom in the amount of available commercial premises.

The mismatch is a ‘striking’ one, according to the British Council for Offices-backed Centre for Cities, as offices are being built in the wrong places according to the existing levels of demand.

80 per cent of medium-sized cities and towns that are exhibiting growth have experienced below average commercial office space growth over the last decade, including Milton Keynes, Cardiff, Northampton, Peterborough, Oxford, and Cambridge, according to the Centre.  The only two places that saw growth above average were found to be Crawley and York.

The average cost to take out an office space rental in these towns and cities is around 50 per cent more expensive than the national average, leading many to spend too much on their office accommodation.  However, even with such a heightened level of demand, supply has simply not kept up within these towns and cities, caused by a lack of office space planning approval and land supply, and exacerbated due to the fact that commercial premises developers target big cities as less-risky investments, since the pool of existing occupiers to choose from is much larger.

The Centre called for cities and towns to work in much more closer concert with adjacent local authorities in order to bring more choice for businesses and developers into their nearby area, work with existing firms to keep abreast of their needs for the future, and keep a higher profile with national property agents.

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