Grade A take-up boosts Manchester office market

PROPERTY consultancy Colliers said that Manchester’s property market continued to perform well during the second half of 2010.

The firm’s latest office report states that take-up of Grade A space represented 752,210 sq ft of the 1.3m sq ft of office space let in 2010. The Co-operative was the largest element of this, representing 382,000 sq ft of space.

It added that as a result, availability of Grade A continued to shrink and was now at a two-year low.  The overall rate of vacant stock remains high at 17.3%, compared with a ten-year average of 11.8%.

“Overall, availability of office space in Manchester continued to see modest declines throughout 2010; however, most of that reduction has been in the Grade A category.

“Second-hand availability has lept by 35% year-on-year, now accounting for 47% of total availability compared to just over one third at the end of 2009.

“Vacant Grade C space has increased by 222,000 sq ft in the last 12 months – a rise of 21% year-on-year.”

Another report by Jones Lang LaSalle forecast that the supply of Grade B space is likely to remain “abundant”, particularly as releases of office space from the public sector look likely from next year.

It predicted that office buildings would hold their values during the next years and that prime yields would remain steady at around 6%.