Recovery sees city’s office take-up reach record levels

The research revealed that take-up in the second half of last year was 353,338 sq ft, bringing the full-year total to 789,530 sq ft, almost double 2012’s figure and up 57 per cent on the ten-year annual average.

Occupier activity throughout the year was driven by financial and professional services, which accounted for more than half of the total 2013 take-up.

Notably, auditing firm KPMG took a total of 89,521 sq ft across two separate deals in Sovereign Square and Broad Gate, while Yorkshire Building Society leased 76,413 sq ft in Broad Gate.

Elizabeth Ridler, partner with Knight Frank in Leeds, explained that the Leeds office market was largely dominated by smaller transactions in the second half of last year, with nearly 65 per cent of all deals falling in the sub-5,000 sq ft category.

However, there were several larger deals, including Leeds City Council taking an additional 50,000 sq ft at the soon-to-be refurbished Merrion House.

]She said: “Named active demand has steadily improved during the past six months, with an increasing number of good-sized requirements over 20,000 sq ft. Notable requirements include Sky (60,000 sq ft) and the Health & Social Care Information Centre (145,000 sq ft), while several law firms are looking to move.

“Increased occupier demand, coupled with limited development activity, has led to an acute shortage of Grade A supply. Currently, only one building in the city centre (No. 1 Whitehall Riverside) is able to accommodate an immediate Grade A requirement over 50,000 sq ft.

“However, several major office developments have recently received planning consent during 2013, including buildings 5 & 6 at MEPC’s Wellington Place project, covering 105,000 sq ft and 144,000 sq ft respectively. MEPC is actively seeking potential pre-lets and has been in discussion with several firms. The second major scheme approved was Town Centre Securities’s Whitehall Riverside, where No. 2 and No. 3, two office blocks comprising 198,000 sq ft and 114,000 sq ft respectively, were approved by Leeds City Council,” she added.

According to Knight Frank’s research, the scarcity of good quality supply has led landlords to push headline rents out,