An impressive office take-up for the first half of 2017 across Sheffield slowed during the last quarter to reach 71,700 sq ft.
But take-up for the year-to-date has almost surpassed the total recorded for the entirety of 2016, according to research from national commercial property consultancy Lambert Smith Hampton.
The Sheffield Office Market Pulse, that provides investors, occupiers and developers with detailed insight across the city, found that, take-up increased marginally in Q3 compared to Q2.
But 2017 is still set to be a strong year for the city, with total take-up likely to be in excess of 400,000 sq ft, which is significantly higher than the five-year average of 330,000 sq ft.
There is significant occupier demand for grade A space, which follows BDP Architects’ letting of 8,000 sq ft at 3 St Paul’s, and several other deals that are currently under offer at the property and at the newly completed Acero Works at Digital Campus – Sheffield’s first speculative office development since 3 St Paul’s.
However, with half of Acero Works’ 77,500 sq ft of grade A office space under offer, there is less than 12-months’ supply remaining in the city.
Office rents have remained stable over the past few years, but the completion of Acero Works has provided the opportunity for small headline growth, which is likely to reach £24.00 per sq ft by the end of 2017.
Furthermore, rental growth remains solid for high-end grade B space, where refurbished schemes continue to let well due to a lack of supply.