The north is an area growing in economic power, and Leeds is a city that appears to be at the very heart of this. So, what is the appeal of this vibrant city and what opportunities does it offer?
Leeds is located in West Yorkshire and boasts a diverse economy, with the fastest rate of private sector jobs growth in the UK. With employment levels high, and the fourth largest student population in the country, it is a city which enjoys a substantial urban economy.
After London, Leeds is believed to be the largest legal and financial centre in the UK, and also supports a significant manufacturing centre.
Business In Leeds
With such a thriving economy, Leeds has become very attractive to businesses, and office take-up in the city is expected to reach an incredible 800,000 square feet by the end of the year. Despite a dip in office lettings it is believed that lettings levels will exceed the long term average of 550,000 square feet by as much as 45%.
A thriving technology sector in Leeds has been identified as a key area for growth, as it is an industry that continues to expand across the world. Over the last five years, technology jobs in Leeds have increased by 2.8%, and forecasts show this continue to grow by another 5.6% in the next five years.
With popular cities struggling with capacity, it is reported that the amount of Grade A space available in Leeds has seen a marked downturn. The first half of the year left only 130,000 square feet in the market, and when combined with the average Grade A take-up of 256,000 square feet, Leeds is left with just a six month supply of such space. This puts increasing upward pressure on the rental values within the sector.
However, investment in good quality office space and a dramatic improvement in the fibre of the city has meant there is significant competition between high profile companies looking space to bring their exciting brands to the area.
This significant growth has meant the city centre is now expanding outwards, particularly to the south and west. This city sprawl is due, in part, to mixed-use schemes being brought forward.
Such a demand for space, and limit to how much is available, has meant that prime headline rents are on the rise. In 2016, prices were around £27.50 per square foot; however, this has now grown to £30 per square foot. The rent for top refurbished office space has also risen by almost a quarter since 2012 to £27 per square foot, from an original rate of just £22.
Such significant growth has meant that property investment in Leeds is becoming increasingly attractive, which fuels its growth further. The need for city centre office development is now crucial if it is to keep up with demand.
With the differential between top Grade A office rents in Leeds and the City Of London at an all time high, even more occupiers may will be heading to the heart of the Northern Powerhouse.