Cardiff

The Cardiff office market received a significant boost during Q4 following Legal & General’s 121,256 sq ft pre-let at Interchange development at Central Square. As such, Q4 was by far the strongest quarter of the year, bringing total take-up for 2020 to 305,000 sq ft, although 39% below the ten-year average. The number of transactions was significantly down in 2020 to 60, compared to an average of 110 over the previous five years.

Elsewhere during the quarter, there were three deals more than 5,000 sq ft including Hamlyn Williams taking 6,461 sq ft at 101 Mary Street and Careers Wales taking 6,694 sq ft at Churchill House.

There continue to be significant requirements in the market, with HM Courts Service looking to consolidate their footprint in the city and a number of professional service businesses actively looking for space. There are also large indigenous companies such as PwC, HSBC and Arup with lease events in 2022, that are currently looking at various options.

However, we do not expect to see many new entrants during 2021 and there is already evidence of several occupiers downsizing their requirements. Furthermore, while there is relatively little evidence so far, we are already seeing a handful of occupiers putting ‘grey’ space onto the market and we expect this trend to continue.

Whilst the city has seen a significant amount of development over the last few years, there is currently a lack of readily available grade A office supply. However, this is likely to change in the short-term with 2021 due to see the completion of 109,000 sq ft John Street development. In addition, we expect to see work start on the 220,000 sq ft Ledger Building as part of the mixed-use Central Quay development.

TAKE UP Q4

City Centre

159,641 sq ft

Out of Town

7,169 sq ft

HEADLINE RENT

City Centre

£25 per sq ft

Out of Town

£15.50 per sq ft

UNDER CONSTRUCTION

Total

227,000 sq ft

Prelet

53%

PRIME YIELD

Q4 2020

5.75%

TOP FIVE DEALS Q4

KEY SECTOR ACTIVITY 2020

Insurance

60%

Property services

8%

Banks & building societies

7%


TAKE-UP

This report has been prepared by Avison Young for general information purposes only. Whilst Avison Young endeavours to ensure that the information in this report is correct it does not warrant completeness or accuracy. You should not rely on it without seeking professional advice. Avison Young assumes no responsibility for errors or omissions in this publication or other documents which are referenced by or linked to this report. To the maximum extent permitted by law and without limitation Avison Young excludes all representations, warranties and conditions relating to this report and the use of this report. All intellectual property rights are reserved and prior written permission is required from Avison Young to reproduce material contained in this report.