The Bristol office market is "holding firm" in the face of strengthening "economic headwinds”, according to a new report.
Real estate company Avison Young’s latest report across the ‘Big Nine’ UK office markets found growing take up in the city during the third quarter of the current financial year.
Around 130,000 sq ft of space was taken during the period - up on the previous quarter and on the first three Covid-impacted quarters of 2020 and 2021.
Notable deals over the three months included the West of England Combined Authority's reported £8m move to a 20,000 sq ft office at 70 Redcliffe Street, and insurance firm Canada Life taking 13,260 sq ft at No1 The Distillery at an average rent of £37.25 per sq ft (psf).
Firms from the tech, media, telecom and creative sectors accounted for almost a quarter of recent take-up.
Amid rising inflation and the energy crisis, Avison Young said prime rents in Bristol city centre were holding at around £42.50 psf.
The company added that office availability is around a quarter below long-term average levels and supply of Grade A space remained “very limited”, pending delivery of new developments under construction.
Cubex’s 110,000 sq ft eco-building Halo is due to complete imminently, but is almost 90% pre-let to law firm Osborne Clark and financial services giant Deloitte.
CEG’s 184,000 sq ft EQ facility and Umberslade's 20,270 sq ft CARGO Work are both due to complete before the end of the year. EQ is already 45% let to Arup and Payment Sense.
Paul Williams, director at Avison Young in Bristol, said: “As economic headwinds intensify, it is interesting to note that occupiers are still seeking out the best space which is driving demand for new Grade A accommodation, as well as a wave of comprehensive refurbishments of older buildings such as the Crescent Centre, 100 Victoria Street and Tower House.
"As occupiers consider their space requirements and focus on the need to attract and retain the best staff, the level of headline rent has become less of a factor in the overall relocation decision.”
Mr Williams added that take-up levels were expected to exceed the five-year average in both Bristol’s city centre and out-of-town markets by the end of the year.
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