A tale of two cities in office leasing activity

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OFFICE leasing activity has dropped in Leeds but risen significantly in Sheffield in the first quarter of the year, according to latest figures.

Activity for the Leeds city centre and out-of-town markets plunged by 16 per cent on the same period last year.

But in Sheffield it increased almost fourfold over the same period.

Property management company Lambert Smith Hampton said the volume of Grade A space let across both markets in Leeds was 20 per cent lower than in 2014, and was the lowest volume since 2012.

But the figure comes against a backdrop of falling Grade A availability, which is constraining occupier activity.

“Both markets continue to be underpinned by the SME sector, with only 24 per cent of the total number of transactions for space above 3,000 sq ft.”

It said competition for the remaining Grade A space is fierce, and it is possible Grade A supply in the city centre could fall below 200,000 sq ft by the end of 2015.

In contrast, in Sheffield take-up for the combined city centre and out-of-town office markets was 115,677 sq ft, almost four times the figure for the same period in 2014. Both of the city’s universities are active developers and occupiers in the market.

“While this is an impressive result and a great start to the year...the University of Sheffield’s acquisition of V2 at Velocity accounted for almost two thirds of this figure.

“Plans have been announced for the new retail quarter in the heart of Sheffield city centre, which will ultimately result in further inward investment.”