Private equity house targets Manchester for office investment
Private equity real estate investment firm Castleforge Partners today announced the acquisition of Linley House, a corporate office building on Dickinson Street, Manchester, for an undisclosed sum.
The investment comes after Castleforge’s research team identified Manchester as having great potential to grow as a world-leading international business hub.
Castleforge forecasts that the 68,000 sq ft Manchester site, which is currently at 67% occupancy, holds a gross development value of more than £30m.
With the investment, Castleforge plans to meet the increasing demand from companies in Manchester for alternatives to traditional fixed-term office space leases through its flexible workspace provider, Clockwise.
Factors contributing to Castleforge’s decision included Manchester’s internationally-renowned universities, growing population of young professionals and the strong long-term prospects for the local economy.
London-based Castleforge also cited the low flexible office penetration rate of 2.8% in Manchester, compared with more than 5% in central London, as a key reason for investment.
Despite the challenging year faced by the city and the office industry, Castleforge is confident in both the office leasing market and the potential for flexible office spaces in Manchester to grow.
The purchase of Linley House is part of a wider series of investments by Castleforge in office real estate across UK regional cities, including Southampton, Exeter and Leeds.
Brandon Hollihan, founding partner of Castleforge Partners, said: “With the likes of Adidas, Google and Amazon all having headquarters located in Manchester, it is clear that the city is now one of the fastest growing business hubs in the world for young professionals and burgeoning start-ups.
“In the coming years, new jobs will continue to be created, and people will once again work together in creative office teams.
“We are thrilled to be investing in the city at this time and look forward to welcoming local companies to Linley House as new members of our flexible workspace provider, Clockwise.”