Market snapshot

Office Market Pulse Manchester Q1 2017

City centre office take-up for Q1 2017 reached 208,223 sq ft across 73 transactions, this was a 6.4% increase on the same quarter in 2016. Of this take-up, over 70,000 sq ft was in the central business district showing a continual move towards Manchester’s higher quality options.

You can download a PDF version of this here Office Pulse Manchester Q1 2017

In this issue:

A promising start to the year

City centre office take-up for Q1 2017 reached 208,223 sq ft across 73 transactions, a 6.4% increase on the same quarter in 2016. Following 2016’s outstanding final quarter, the market’s momentum has steadied as expected. 

Notable transactions taking place in Q1 included, 22,196 sq ft to Travel Jigsaw Ltd at 42-44 Fountain Street, 12,088 sq ft at 40 Spring Gardens to Aldermore and 7,700 sq ft to Flatshare Ltd at the Northern Quarter’s new Grade A refurbished scheme 35 Dale Street which is due to complete Q3 2017. 

Small scale requirements (space sized below 5,000 sq ft) accounted for 89% of the 73 transactions completed in Q1. Similar levels of demand from the SME sector will continue throughout 2017.

In South Manchester take up in Q1 rose to 139,249 sq ft, a 58% increase on the same period last year. This was largely due to Stagecoach taking 32,550 sq ft at the new Grade A Stockport Exchange. 

The combined Salford Quays and Old Trafford take-up figure equated to 66,000 sq ft, which is a 30% increase on Q1 2016. The largest letting was 21,500 sq ft at Broadway House, Salford.

Demand for high quality office space at a peak

The Central Business District (CBD) returned to the top of the most active market in Q1, with 70,987 sq ft transacted. 

There is a clear increased demand for high quality space from occupiers of all sizes, Across 27 deals, over a third (36%) were in the £20.00+ per sq ft rental bracket. Twelve months ago, just nine transactions were in the same bracket.  

Undoubtedly the 10 transactions outside the CBD which completed within the £18.00 - £19.99 per sq ft bracket, would be achieving higher rental figures if they were situated within this district.

Whilst the forthcoming snap general election may have a short term impact on the office market in Q2, this will only be for a limited period. Manchester’s office market has shown resilience throughout 2016’s political events and this will continue throughout 2017. 

Key occupational transactions, Q1 2017


Size (sq ft) 

Landlord(s)/ vendor


Stockport Exchange 32,550 Muse Stagecoach
42-44 Fountain Street 22,196 Wilton Developments Ltd Travel Jigsaw Ltd
Orange Building, Media City 16,060 Peel Media JTI
40 Spring Gardens 7,700 Impax Asset Management Aldermore
 35 Dale Street 7,700  Helical  Flatshare ltd

Source: Lambert Smith Hampton 

New out of town headline rent

The highest rent achieved within the city centre this quarter was at 82 King Street at £32.50 per square foot across two deals. 

Due to the limited supply of grade A space, incentive packages remain low with a six to nine month rent free package usually being offered for a five-year lease with a three year break option.

The Orange Building at Peel’s MediaCityUK achieved the new out of town headline rent of £25 per square foot with JTI taking 16,040 sq ft. This reflects the continued strong demand for Grade A office space, not only in the city centre but also out of town.

Manchester office investment activity

Overall, Greater Manchester office investment activity picked up in Q1 2017 after a subdued Q4 2016.

Volume totalled £119m, up by £88.6m on the previous quarter, though this also reflects a decrease of £163m on the same quarter the previous year. However, in Q1 2016 there were two major investment deals which included XYZ (£85m) and Piccadilly Place (£115m).

Activity for the quarter was dominated by City Centre transactions which comprised six out of the nine transactions. 

Key deals included AM Alpha’s purchase of the Zenith Building for £23m and 201 Deansgate which was bought for £29m by Aviva. 

In response to ongoing concerns surrounding Brexit and the general election, investors are expected to act with caution, especially retail funds and institutional buyers. However, there is still strong appetite for well-located office investments.

Key investment transactions, Q1 2017


Value (£m) 



Deansgate, 201 29 Essex CC Superannuation Redefine International
Zenith Building, Spring Gardens 23 AM Alpha TH Real Estate
 Concord Business Park 20 Global Mutual Properties Legal & General Linked PF
Mosley Street, 80 12 Mayfair Capital Bilsdale Properties Ltd
Landmark, Booth Street  12 Barings Real Estate Castlebrooke Investments
Express Building, Great Ancoats Street 11 Wittington Investments A&A Investments

Source: Lambert Smith Hampton 

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0161 242 7061

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