Public sector drives Manchester construction
MORE than half of the construction activity that got underway in Manchester in the past year was backed with public money.
That’s according to Drivers Jonas Deloitte’s 2012 Crane Survey which cites building programmes by the city’s two universities and the city council.
The universities were delivering nearly 400,000 sq ft of educational space – one third of non-residential floorspace – at the time of the survey, while the council’s work on Central Libaray and the Town Hall further boosted construction.
It came at a time of sluggish activity in retail, residential, leisure and office sectors.
Michele Steel, director at Drivers Jonas Deloitte in Manchester, said: “The public sector has continued to play a significant role in the ongoing regeneration of Manchester city centre – the two Universities combined were delivering one third of the total non-residential floorspace under construction at the time of our survey.
“With the city council’s ongoing work at the Town Hall and Central Library, more than half of the activity has been public sector led. This is nothing new in Manchester and is demonstrative of the proactive development approach of the city’s key institutions.”
Three office schemes started during the period: Argent’s 268,000 sq ft 1 St Peter’s Square; Royal London Asset Management’s 21,000 sq ft scheme at Fabrica in Pollard Street, and NQ Developments’ 22,000 sq ft Bengal Mill.
Total take-up in the first half of 2012 was 311,000 sq ft, just 3% more than the same period in 2010 which delivered the lowest level recorded by the survey since it began 14 years ago.
Despite subdued take-up demand for Grade A space has been resilient. Occupier demand combined with diminishing supply has led to a 2% increase in prime rents.
Residential development is at a 10-year low with the 135-unit residential part of Bengal Mills the only new start during the survey. Three projects completed in 2011, totalling 251 units. This is up 8% on the 2010 total but this is still only 17% of the 10-year annual average.
There was little retail development with only the Fabrica scheme offering new space. Some 13,000 sq ft should be finished by the end of the year. There were no new starts on student housing, but there are two new hotels under construction delivering a further 343 rooms at Fabrica and Premier Inn on Lena Street.
