The Big Nine
Quarterly review of take-up in the major regional office occupier markets in the UK.
With a total 1.63m sq ft transacted, Q2 was a reasonably healthy quarter across the Big Nine, with take-up volumes 16% below typical levels. A total of 452 deals completed in Q2, which on a rolling 12-month basis was 11% below.
Bristol (+9%) and Manchester (+2%) all saw above-average take-up this quarter compared to the 10 year average. Best-in-class space remains in high demand and short supply across the Big Nine city centres, which continue to drive record levels of rental growth. Birmingham, Bristol, Leeds, Liverpool and Manchester all saw increases to their prime rents this quarter, bringing the Big Nine average prime rental growth to an unprecedented level of 7.77%.
With inflation back to the 2% target in June, the Bank of England is now pivoting from fighting inflation to supporting the economy, as shown by the Base Rate cut of 25 bps seen in August. Encouragingly, Oxford Economics are predicting that q-on-q GDP growth in the year to June 2024 will reach 0.8%, up from 0.3% in the year to March; then accelerate further to 1.2% in the year to September. The election of a new UK government in July, with a large majority, means the economy faces a stable policy environment that will allow businesses to plan for the long-term.
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