Offices to Let Market in Manchester: 2023 Analysis and 2024 Predictions

2023 Analysis

The Manchester office market experienced a mixed year in 2023, with strong demand for Grade A space but a softening of rents in some sub-markets. The overall vacancy rate fell to 7.8%, its lowest level since 2007, while take-up reached 2.8 million sq ft, the highest since 2018.

Key factors influencing the market:
• Rising employee expectations: Employees are increasingly demanding more flexible and attractive workspaces, which is driving demand for premium office space.
• Tech sector growth: Manchester's tech sector is booming, attracting new businesses and expanding existing ones. This is putting upward pressure on demand for office space, particularly in areas with strong tech clusters.
• Increased hybrid working: The pandemic has led to a shift towards hybrid working, where employees split their time between the office and home. This is reducing demand for large, centralized offices and increasing demand for smaller, more flexible spaces.

Rents:
• Grade A: Rents for Grade A space remained stable in 2023, with an average asking rent of £27.50 per sq ft. However, there was some softening in rents for smaller spaces in the city centre.
• Grade B: Rents for Grade B space fell by an average of 2.5% in 2023, driven by an increase in supply and softening demand. The average asking rent for Grade B space was £18.50 per sq ft.

Take-up:
• Total take-up: Total take-up reached 2.8 million sq ft in 2023, the highest since 2018. This was driven by strong demand from tech companies, financial services firms, and professional services providers.
• Sub-market take-up: The strongest sub-markets for take-up in 2023 were the Northern Quarter and Ancoats, with both areas benefiting from their strong tech clusters.

2024 Predictions

The Manchester office market is expected to remain stable in 2024, with continued demand for premium office space and some softening of rents in secondary sub-markets.

The following factors are expected to influence the market:

• The continued growth of the tech sector: The tech sector is expected to remain a key driver of demand for office space in Manchester. This is likely to lead to further development of tech hubs and an increase in demand for Grade A space.
• The impact of hybrid working: Hybrid working is likely to continue to have an impact on office space requirements, with some companies downsizing their office space and others looking for more flexible layouts.
• The wider economic outlook: The wider economic outlook will also play a role in determining the performance of the Manchester office market. A strong economy is likely to support continued demand for office space, while a weak economy could lead to increased vacancy rates and falling rents.

Overall, the Manchester office market is expected to remain resilient in 2024. The city's strong economic fundamentals, coupled with its growing tech sector and attractive workspaces, are likely to attract new businesses and drive continued demand for office space.

 

Looking For Office Space? Before You Choose, Think About How Much Office Space You Need

When you start in business, it is easy to get carried away about the office space you will use. Luxurious communal areas, high-tech break-out zones, and Googlesque recreational facilities are great aspirations to have. Still, it might be a good idea to leave such luxuries until you made your first million or two!

When you choose an office space for your new start-up, or even if you are an established business, you should consider the area you need. No-one wants to be paying for space they are not using, so this article aims to help you decide on what size of office is suitable for your needs. 

Things You Should Consider When Choosing Your Office Size

Most people don't put much thought into the space they need for an office. They tend to be swayed by what their competitors are using or by an estate agent's advice. You can get a more accurate appraisal by asking yourself a few basic questions:

 

Open-plan offices give you a greater degree of flexibility, and of course, you are not wasting any space with internal walls. To provide you with an idea of the space required for close-off or private offices, an appropriately sized office for a manager would be around 100 square feet. If you need to include a meeting table in such an office, the size will increase to approximately 200 square feet.

According to the Workplace (Health, Safety, and Welfare) Regulations of 1992, the minimum workspace you need to provide your office employees is 40 square feet per person. However, the average space allocated is between 50-60 square feet, and if any employee needs filing cabinets or storage, this can increase to around 100 square feet.

Other areas of your office that you should consider the minimum sizes are as follows:

Facility Minimum Size (square feet)
Reception Area 100, pulse 10 for each waiting space
Small Meeting Room 100
Large Meeting Room 150
Standing Dining Area 75
Seated Dining Area 75 plus 25 for each seat
Kitchen 75 plus 25 for each seat
Break-Out Area 75 plus 25 for each seat
Storeroom 200

Conclusion

It is great having lots of space for your office employees to enjoy. However, office space comes at a premium, and you should carefully consider whether you will make fair use of the space you rent and whether your business can afford to rent additional space. Hopefully, this article will help you assess how much space you need for your office.