It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.
It has become something of a tradition, given that we’ve been doing this now for over 30 years.
Here we speak to Eamon Fox, partner and head of development at the Leeds office of global property consultancy Knight Frank.
There is no doubt that this has been an interesting, if challenging, 12 months for the commercial property sector in Leeds and the wider Yorkshire region. However, the combination of a stuttering economy and political instability has not dampened investor enthusiasm and confidence in building and enhancing brand-new offices in Leeds, confidence based on continued strong letting activity, large relocations to Leeds by firms growing into Leeds for the first time and thinning pipeline of quality office space.
There have been some significant deals, including the recent x+why deal for 34,000 sq ft at Bridgewater Place, and the £80 million acquisition by Ashtrom Properties UK of M&G’s 230,000 sq ft Central Square was Leeds’ largest office investment deal for more than five years. The sale was described by my colleague Henrie Westlake as a deal that will “almost certainly be viewed as the bellwether deal of this cycle.”
It’s important to be optimistic. The iconic City Square House, next to Leeds Station, is now open for business with high-class occupiers such as DLA Piper and Markel having moved in, while Kinrise’s Trevelyan Square and 34 Boar Lane continue to set a high bar for superb office space. CEG’s Temple continues to be an exceptional success and Opus’s 12 King Street has big news coming in Q1 2025 on the final few lettings in the building.
As we look forward to 2025, it is highly likely that prime office rents, now hovering around £40 per sq ft, will rise to a £46 per sq ft high by the end of the first quarter. This is primarily because of a scarcity of quality office space, but also because Leeds is now regarded as the most successful and enterprising regional city, along with Manchester, in the UK. We are also blessed with a number of talented developers, such as CEG, Rushbond, Kinrise and Opus North. At Knight Frank, we expect to be busy, across all sectors, including investment and industrial, as well as office agency.
