Leeds prime office refurbs in demand as new build supply runs low

Strong demand for Grade A new build office space in Leeds has seen current supply fall to 239,000 sq ft with availability set to decline even further by the end of 2017.

This will fuel occupier appetite for top quality refurbished office space in the city, according to Savills, with the current £3 differential between rents for Grade A and refurbished offices (£27 per sq ft and £30 per sq ft respectively) likely to decrease significantly in 2018.

Savills Spotlight: Office Refurbishments in UK Regional Cities report predicts that 38% of the total speculative office space being delivered in UK regional cities over the next three years will be in the form of refurbishments.  This is likely to be mirrored in Leeds, as developer caution and lack of new build space sees occupiers focus on prime refurbished offices, the report says.

In turn, landlords are likely to carry out ‘refresher’ works on offices already refurbished within the last seven to eight years to ensure they meet the desired quality standards, said Savills.

In Leeds, the firm highlights The Canal & River Trust’s 9 Bond Court and CBRE GI’s 7 Park Row as prime examples of the ‘new generation’ of prime office refurbishments.  At 7 Park Row, a £7m refurbishment including the creation of a double-height reception, floor to ceiling windows throughout, basement gym, electric car charging points and ‘defurb’ of four floors is currently underway.

Paddy Carter, office agency director at Savills Leeds, said: “With demand for high quality office space soon to outweigh supply in Leeds, top quality refurbished stock continues to play a vital role.  It also helps to satisfy occupier demand for non-traditional office space, such as the smaller, creative-style floor plates available at 7 Park Row.”