Take-up of office space in cities outside of central London during Q4 2020 totalled 1.1 million square feet, an increase of 138 per cent compared with Q3 2020, shows the Q4 UK offices snapshot by real estate adviser CBRE.
However, the overall take-up for 2020 reached 3.9 million sq ft, a decline of 40 per cent on the five-year average.
One of the best-performing markets was Manchester, which saw a strong end to the year with 349,500sq ft of transactions.
This was an increase of 415 per cent on the previous quarter and in line with the Q4 average.
The overall largest UK deal of the quarter saw BT pre-let 175,680sq ft at 4 New Bailey, Chapel Street, Manchester. BT was also responsible for the largest deal of the year in which it pre-let a further 280,000sq in Birmingham. As a result, the creative industries sector represented the largest share of take-up.
Overall availability across the UK Markets increased by 16 per cent from the end of 2019 to stand at 15 million sq ft at the end of 2020. There were increases in the availability of both secondhand space (to 11.7 million sq ft) and new space (to 3.8 million sq ft).
A total of 2.0 million sq ft of development space completed across the UK markets in 2020 and a further 5.3 million sq ft is anticipated to complete before 2024 and of this 44 per cent is already pre-let.
Paige Slade, of CBRE UK research, said: “The Covid-19 pandemic has had a huge impact on the office leasing market, which ended 2020 well below average. However, we are starting to see a gentle recovery across the major UK office markets, buoyed by regional activity. We continue to see the strongest demand for high-quality, amenity-rich space. Whilst we don’t expect leasing demand to be strong in H1 2021, by the end of the year we should start to see demand return to more normal levels, with new space outperforming secondary space.”