Commercial Property Hotspots Emerging Beyond London
London may no longer be England's top commercial property hotspot, as areas across the country are starting to emerge as new players in the market, according to new research.
A survey of office space providers and landlords in the UK found that Manchester, Birmingham and Leeds are now among the most popular locations for investors looking for office locations.
Conducted by officebroker.com, the research covered data collated over the last 12 months and based its figures on its own brokerage data as well as the number of offices let, the percentage of revenue achieved and the percentage number of total sales.
On this basis, London, Manchester and Birmingham all ranked in the top five for desirable locations in the country, with Reading and Edinburgh also favoured among investors.
Warren Bright, chief executive of Propertyfinder.com, says that research from his company confirms Manchester as one of the most favoured commercial property hotspots beyond London.
He said: "Data pulled from our site can give us a clear mapping of the most popular places in the UK to invest in property. As one would expect, London is top of the list. However, completing the top five are Leeds, Bristol, Cardiff and Birmingham."
"All these cities have experienced serious regeneration and development in recent years and are now starting to reap the benefits, attracting home buyers who want to invest in a city lifestyle without the sky-high London prices," he added.
Mr Bright continued that despite not figuring in the top five until recently, experts are aware that Manchester has been experiencing "serious development" in the last five years and has been "attracting buyers in droves".
Chris Mulcahy, partner at King Sturge property consultants, broadly agrees with Mr Bright's sentiments and believes that there is a connection between cities are undergoing urban regeneration and those that are seeing renewed investment.
Data from the Manchester Evening News suggested that about a million square feet of office space was let out in the city in the last 12 months, leading Mr Muclahy to comment: "Manchester enjoyed the highest take-up of office deals over 10,000 sq ft in 2006".
He added that "high profile deals" from businesses such as HBoS, Barclaycard and HSBC have added to the reason why prime office rents are now approaching £28.50 per sq ft.
However, Peter Skelton, head of Lambert Smith Hampton, maintained an air of sobriety in his opinion of the commercial property market.
He said that some analysts may have been overly optimistic in their interpretations of Manchester commercial property.
Mr Skelton told the Manchester Evening News: "The problem is that property people get dazzled by the big deals - and we only had a handful of big property deals in 2006, with very few headline-grabbers in the city centre. Actually, though, looking at the mass of smaller and medium-sized deals, 2006 wasn't bad at all."
In related news, it was predicted that city centre apartment values in Manchester will by rise by 47.7 per cent over the next five years.
Data from Nationwide's house price index in together with the opinion of experts from Channel 4's Location, Location, Location, suggested that the rise was down to the city's burgeoning buy-to-let sector.