UK Insights: Commercial Markets Update
15 September, 2022
The Commercial Edge Q2 2022 report is our member Carter Jonas’ regular update on the outlook for the office and industrial markets across Bath, Birmingham, Bristol, Cambridge, Leeds, and Oxfordshire.
Sector Highlights from the Report:
Office take-up across our regional Commercial Edge cities in Q2 of 2022 has been marginally below last quarter and 12% below the 10-year quarterly average but 30% up year on year. Whilst there is a large quantity of office stock available, much of it does not meet the requirements of today’s occupiers and prime, modern space is being favoured over old. Despite a more permanent adoption of home working and uncertainties around future levels of office occupation, there has not been any fall in demand or prime rental levels, and in most locations, prime city-centre rents have continued to climb above their pre-pandemic levels.
Industrial take-up across the Commercial Edge cities picked up in the second quarter following a weak Q1. At just above 2.4 million sq ft, take-up in Q2 2022 was 14% up quarter on quarter but 39% down from Q2 2021. Demand from 3PLs and e-commerce retailers will remain robust, especially for sustainable logistics warehouses and last-mile warehouses. Meanwhile, in life science-heavy markets like Cambridge and Oxford, there is an increasing demand for hybrid space to meet the requirements of this sector. The key feature remains a growing lack of stock and the shortage of development sites, which is further exacerbated by rising costs, supply chain issues and labour shortages.
Click here to find out more about Office and Industrial take-up, rents and investment levels in each city.