Q2 2011: How is the UK Shaping Up?
Following the release of officebroker.com’s latest reports, we caught up with our very own Research & Project Manager – Simon Jones – to find out how the UK’s serviced office market is shaping up.
1. Overall is there cause for optimism in the Q2 stats – or is there more bad news than good?
The extended run of bank holidays certainly put office relocations on hold during the second quarter of 2011. While some businesses, in anticipation of this disrupted trading period, appeared to delay their office move others seemed to have ploughed on. What was certainly apparent however was that enquiry levels consistently dipped during April.
But when looking at the market YTD, Central London and several other key Cities have seen positive growth which should ultimately begin to filter out to the rest of the UK over the next 12 – 18 months.
2. Jim Venables (officebroker.com MD) said earlier this year that he expects prices to rise throughout the year. Is his optimism being rewarded?
Right across the UK price recovery is taking place based on our data. From Central London to Manchester, Bristol, Edinburgh and Leeds all of these key markets have recorded a higher average workstation price during the opening 6 months of 2011 than during 2010. I would say this is optimism becoming reality.
3. In the past, London has often been the trailblazer in terms of market trends and price. Do you think that the capital is leading the way again?
Put simply yes. While the overall number of businesses has reduced slightly, the larger more committed requirements of those active in the market over the last 6 months demonstrates that there has been a shift in the market. In theory this should accelerate a rise in occupancy levels, put a premium on the office space available, and help prices to recover back toward the kinds of levels seen in 2008.
4. Which regions stand out to you as being the most improved – in terms of demand and commitment?
Greater London, the North West and Yorkshire & Humberside have delivered some positive results overall during the opening period of 2011. This perhaps reflects the improved activity taking place in the key cities such as Leeds and Manchester ΓÇô evidence perhaps of this activity already beginning to spread out to the surrounding area.
5. In the conventional sector there is talk of an impending shortage of space in London. How is the serviced market looking – and how does it compare to Q2 2010?
The number of providers choosing to work alongside officebroker.com has continued to increase, suggesting that new supply is coming to market. However as commercial space becomes more limited so will the opportunities for new serviced office locations.
6. Similarly how is demand holding up in London – do you think demand could soon overtake supply?
Based on the feedback from our consultants during their recent visits, a high proportion of Central London locations are already operating at between 75-100% occupancy. While natural churn will likely ensure on-going availability, growing occupancy could limit the choices available to those entering or moving within the market.
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View and download the latest data from Q2 2011 online here:
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