Market snapshot

Office Market Pulse East Midlands Q1 2013

The East Midlands office market started the year strongly with Q1 take-up totalling almost 120,000 sq ft. Leicester saw higher take-up than Nottingham with 19 transactions totalling over 50,000 sq ft. Derby’s take-up remained steady with a total of just over 25,000 sq ft transacted, but Nottingham saw a 47% decrease in comparison to Q1 2012 with a total of just over 40,000 sq ft.

You can download a PDF version of this East Midlands Office Market Pulse, or to read and sign-up to receive Office Market Pulses from other UK centres, click here.

In this issue:

Positive outlook for the East Midlands

Derby saw an impressive first quarter with the completion of a freehold sale to Severn Trent Water; approximately 46,000 sq ft of offices with additional warehouse space. For a breakdown of current take-up click here.

Leicester saw a significant number of transactions commence legals in Q1 with 50,000 sq ft completing. With many more due to complete in Q2, market confidence is certainly showing signs of improvement. For a breakdown of current take-up click here.

Nottingham continues to suffer from a shortage of grade A office supply with take-up levels falling below the year-on-year Q1 average. For a breakdown of current take-up click here.

Significant occupational transactions in Q1 2013

Property  Size (sq ft)  Landlord(s)  Tenant  Lease info 
Unit 3, The Osiers, Meridian Business Park, Leicester 13,349 Private individual  Howes Percival LLP  10 year lease with 5 year break 
1 Woodborough Road, Mansfield Court, Nottingham  38,000  Adderley, Woodborough Road Ltd  Skyling    Investment sale £1.96m achieved 
PB4, Pride Park, Derby  46,000  Citigroup  Severn Trent Water  Freehold sale 

First speculative office development for more than 10 years

Friar Gate Square in Derby comprises just over 32,000 sq ft of office space constructed to an occupational density of 1:8.5 sq m and finished to a BREEAM rating of 'excellent'. Completed to grade A specification, the building provides floor plates of 3,500 to 7,000 sq ft. For a breakdown of Derby supply by grade, click here.

The development, which can accommodate a further 43,000 sq ft in new buildings, has been undertaken by Lowbridge Developments with financial support from Derby City Council. 

The council's input was integral to the scheme and it is hoped local authorities elsewhere in the East Midlands will follow Derby's lead to encourage speculative office development across the region.

In Leicester, Marlborough Property Co Ltd is launching a speculative phase of out of town office development in response to the lack of grade A supply. They will construct circa 30,000 sq ft of grade A offices over three buildings at Watermead Business Park in Syston. The site is well located with some high calibre occupiers such as Bentley, Flo Gas and Dunelm Mills.

For a breakdown of Leicester supply by grade, click here.

For a breakdown of Nottingham supply by grade, click here.

How did the investment market perform in Q1 2013?

Total investment in Q1 2013 rose by 8% in comparison to the previous quarter, reaching £8.05bn. 

The average deal size reached a new high of £28m. 

This activity was despite investment in central London offices falling by 25% in Q1 2013.

What does this mean for the market? Find out in UKIT 2013 and read our predictions for the year ahead.

 

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Jane Taylor

0116 255 2694

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Jane Taylor
Director - Office Agency

0116 255 2694

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