Newcastle saw robust office leasing volumes during 2020 given the economic backdrop, totalling 629,200 sq ft across the whole market, 8% below the ten-year average.
The out-of-town market was more dominant than usual, accounting for 76% of all take-up for the year, although during Q4 the largest deal was in the city centre, 25,482 sq ft to NHS charity Rococo at I Carliol Square. Out-of-town there were five deals more than 5,000 sq ft, the largest of which was 15,241 sq ft to Essentra.
Immediate demand requirements look healthy for the year ahead, with Invest in Newcastle continuing to receive north shoring and reshoring interest from companies attracted to the city by the competitive low-cost base.
The city centre continues to be the focus for office development. The Lumen is letting well and The Spark - not due to complete until 2022 - is already seeing significant interest. As a result, with a lack of any ‘grey space’ returning to the market in the short-term, we expect vacancy levels to remain relatively low.
Looking further ahead, construction has started on Ask Real Estate’s 70,000 sq ft One Strawberry Lane, following forward funding from Canada Life, with the building already let to the Home Group on a 30-year lease. Elsewhere, Bank House on Pilgrim Street is under construction and due to complete in 2023.
TAKE UP Q4
31,912 sq ft
Out of Town
63,540 sq ft
£26 per sq ft
Out of Town
£16.95 per sq ft
227,000 sq ft
TOP FIVE DEALS Q4
KEY SECTOR ACTIVITY 2020
Health and social care
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