Leeds office rent price approaches all-time high

The cost of office rents in Leeds could reach an all-time high of £28 per sq ft, according to global property consultancy Knight Frank.

Knight Frank’s latest Regional Office Market Presentation Report (ROMP) reports that the quality of new and refurbished office accommodation in Leeds, along with occupier demand, is causing a rise in rents towards a record level.

Eamon Fox, partner and head of office agency with Knight Frank in Leeds, said: “Leeds is buoyant. A classic example of this buoyancy is NFU’s No I Whitehall Riverside, a superbly refurbished office building, which has seen two significant deals at £26 per sq ft in the past six months.

“Quality occupiers Handelsbanken, who have taken 8,117 sq. ft, and the FDM Group (17,159 sq. ft) have moved to No 1 Whitehall Riverside, primarily because it is one of the finest office buildings in the city. These serious rents underline its attraction.

Mr Fox continued: “We are seeing the prospect of similar rents be achieved elsewhere in the city of high-quality refurbished accommodation and on new-build product. We are now moving in the direction of £28.00 per sq ft.

“Meanwhile the good news for Leeds continues. Investor appetite for regional office stock is strengthening. Not surprisingly, given the substantial weight of money targeting regional offices, the office yield, which is the annual return on an investment expressed as a percentage of the capital value, is a healthy 5.25 per cent.

Mr Fox added: “Nationally, given current named requirements of 4.58 million sq ft, which is the highest in five years, we expect to see higher levels of occupational demand back above the five year average.”

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