There have been few developments in the last 10 years and by the end of Q2 2017, the city now has only two years of supply, the lowest in the South West and South Wales region.
“Whilst there has been a disappointing level of take-up over the last 12 months, this reflects a shortage of quality supply and a corresponding lack of major transactions,” says Tom Rees of LSH.
Rees is confident however that the picture is not all gloom as the growth of the city’s two universities is promoting the development of student accommodation, with some 2,500 beds planned across various schemes.
“Swansea’s student population is expected to grow from 20,000 to 30,000 over the next few years. Whilst this will provide the city with a boost, converting offices such as the Oldway Centre and Sun Alliance House into student accommodation does erode office supply,” he says.
“The logical next step for Swansea will be the development of high quality office space that would both attract new business to the city and house start-ups emerging from Swansea’s ‘knowledge economy’.
“The City Deal and the regeneration it promises is on the horizon, but it is only when new stock comes onto the market that Swansea can expect to see a growth in prime headline rates. Until then, it is likely activity will remain subdued.”