Manchester is the largest city in the North West of England. It is a major regional city and some will argue that it is the UK’s ‘Second City’. It is known as a ‘Core city’ within the UK government’s ‘Northern Powerhouse’ initiative that was set up to empower the North’s economy.
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Internationally known for its music, football teams, and scientific achievements, it is a city that has both a national and international pull. Manchester city centre has a mature office space market with several areas within the city that are popular office space locations. There is also a healthy office development pipeline in the city for both existing office space areas as well as brand new ones.
There are several locations and sub-markets throughout Greater Manchester, however, this article is focussed on office space in Manchester city centre.
Why is Manchester a popular business location?
Manchester was where the Industrial Revolution began so has always had a strong link with commerce. It was also where Mr Rolls met Mr Royce and where major scientific breakthroughs have been made such as the splitting of the atomic nucleus and the development of the concept of the first computer, by Alan Turing. He, incidentally, would have been 108 years old yesterday on the 23rd June.
It has a population of circa half a million with several higher education institutions such as Manchester University and Manchester Business School so it has a broad and deep talent pool.
It is well connected; the M60 motorway circles around Manchester and links easily to the rest of the UK motorway network.
Holyhead port can be reached in just over 2 hours and this has regular ferry connections to Ireland.
Its international airport is the UK’s 3rd largest and handles circa 30 million passengers per year travelling to approximately 200 locations.
The city centre has 3 mainline train stations that connect with the UK rail network and connections from Manchester Piccadilly to the capital take just over 2 hours. This will be reduced to 1 hour 20 minutes with the introduction of the HS2 rail network.
Manchester has a strong reputation in the arts and in sport with internationally acclaimed artists, musicians, sports stars and teams.
Several national and international companies have chosen Manchester in which to base their business or at least have a regional office in the city.
This has led to a mature and diverse ecosystem of office space occupiers in the city.
And it continues to grow.
Who are the big office space occupiers that call Manchester home?
Manchester is a well-respected business space location and has been attracting large office space occupiers for many years. Manchester was actually the home of the UK’s tallest office building in the 1960s in the Co-Operative Group’s CIS Tower headquarters offices.
Today, the Grade-II listed property is clad in solar panels and, on completion in 2005, created the largest commercial solar façade in Europe. It generates 180,000 kWh of electricity per year that is fed back to the National Grid.
One the largest office occupiers in the city, aside from the aforementioned Co-Operative Group, who are the largest, is the Royal Bank of Scotland. RBS took just over 450,000 square feet of office space at Spinningfields in 2006 which basically kick-started the 20-acre thriving city centre district that we see today.
Other large occupiers include Google who occupy the Spaces building on Oxford Street known as Peter House.
Professional services firm KPMG occupy 74,000 square feet of office space in St Peter’s Square and were the first occupiers of the One St Peter’s Square development when they moved in in 2015. They have just over 700 staff in the property.
Autotrader was the first major office space occupier of the First Street development at the southern end of Manchester city centre. They moved 600 staff and signed a 15-year lease on 60,000 square feet when they moved in in 2014.
In 2004, The Bank of New York Mellon chose Manchester as the location for its new Global Delivery Centre (GDC).
Its office at One Piccadilly Gardens, opened in 2005 with 50 employees. In the 10 years since, it grew its headcount to more than 1,200, an increase that led them to opening a second office in the city, in Spinningfields, in 2008.
The transport arm of Booking.com also currently has four offices in Manchester; two on Fountain Street, one on Deansgate and one on Quay Street.
In 2018, it was announced that Booking.com had signed a 12-year lease for 222,000 square feet of office space at the Manchester Goods Yard which is part of the St John’s regeneration masterplan on the former Granada Studios site, in between Spinningfields and Castlefield.
It will become a tech campus for over 1,500 employees and will be second-largest location outside of its main business base in Amsterdam.
In January 2020, Amazon opened the doors of its new corporate offices at the Hanover Building on Corporation Street in the NOMA district of the city centre. It announced that it would be creating 600 new jobs with the office opening.
Where are the popular office space locations in Manchester?
Manchester’s traditional core or central business district is based around the upper half of King Street which sits between Cross Street and Piccadilly Gardens and encompasses Brown Street, Fountain Street and Spring Gardens. There is a range of new Grade A office space buildings here as well as Grade B refurbished properties. Both leased and flex space options are available in the Manchester central business district.
One of Manchester’s newer office space districts is NOMA which is at the northern end of the city centre close to both the Northern Quarter and Victoria Station. It is led by the Co-Operative Group, that is the major occupier in the area, and developed the scheme with development partners. The Co-Operative Group have their new headquarter offices here named One Angel Square. Both WeWork and Amazon recently signed office space deals here.
St Peters Square is another new office space district and it adjoins both the central business district and Oxford Street. It has excellent public transport links being a major tram intersection and is just 5 minutes from Oxford Road train station. KPMG was the first major tenants of the scheme in 2015 and JLL recently signed a deal that achieved a new headline rent record for the city at £36.50 per square foot.
The Northern Quarter is a trendy part of the city centre and roughly sits in between the ring road and Piccadilly Gardens. The properties in the NQ are mainly disused warehouses, mills, and factories from the early days of the Industrial Revolution. Many of these have been converted into apartments, restaurants, retail offerings and office space. BooHoo online clothing retailer is one of the largest occupiers in the Northern Quarter.
Just across the ring road from the Northern Quarter is Ancoats which is becoming an extension of the NQ and a district in its own right. There are several residential developments in Ancoats and new co-working spaces such as Beehive Lofts offer great office space in the lofts of converted mills, are now opening and are proving very popular.
The area surrounding Piccadilly Station has become a popular workspace solution over the last 15 years. Certain buildings such as Bruntwood’s 111 Piccadilly have been popular for many years however it was Argent’s development of Piccadilly Place in the late 2000s that brought a new wave of occupiers such as Barclays, NHS and Egencia to the area. New amenities and the excellent transport links keep this location popular. Orega provides serviced offices and co-working spaces at Piccadilly Place, as do other providers.
Deansgate is a major arterial road that intersects the city centre. It is a popular retail and leaisure street with shops, bars, restaurants, gyms, and cinemas. It has many office offerings along its length including space with the Victorian Barton Arcade, Grade B space above shops, Grade B standalone space, and brand new standalone Grade A office space such as 125 Deansgate that opens its doors in April 2020. Flexible workspace provider Spaces has taken all of the 120,000 square feet and will offer serviced offices, co-working spaces such as hot-desking areas and meeting room hire. 125 Deansgate is located opposite one of the main entrances of Spinningfields.
The 20-acre Spinningfields scheme sits in between Deansgate and the River Irwell. Following a major regeneration by Allied London the scheme welcomed thousands of RBS employees to the scheme when the banking company signed for 456,000 square feet in 2006. Since then many occupiers have rented office space at the scheme including Deloitte, HSBC, Grant Thornton and the Guardian Media Group, to name a few. There is a variety of leasehold and serviced offices available to rent at Spinningfields.
Just across the Quay Street border of Spiningfields sits the old home of Granada Studios where ITV soap opera Coronation Street was once filmed. Rebranded ‘Old Granada Studios (OGS)’ within the St John’s neighbourhood, the area which includes Enterprise City is Manchester’s newest office space district. Booking.com will be the first major tenant moving 1,500 employees into their 220,000 campus in 2020.
Manchester office space market
Manchester city centre enjoyed a strong year of office take-up in 2019 with more than 1.5 million sqft of workspace let across over 250 individual office space deals.
The 2019 take-up figure is 10% above the five-year average of 1.35m sq ft.
Last year also saw a new record office rent of £36.50 per square foot achieved when JLL acquired the 10th floor at St. Peter’s Square. They took just under 14,000 square feet and signed a 15-year lease. This was the first deal at the property named, Landmark, which provides BREEAM Excellent and Wired Score Platinum-certified office space, and the largest floor plates in the city centre.
The take-up figure includes some noteworthy transactions including the latest pre-let at Enterprise City at the ‘Old Granada Studios’ where WPP committed to 82,000 sqft at the Globe & Simpson building. And 2 New Bailey Square on the banks of the River Irwell which attracted Eversheds Sutherland and BLM to 47,500 sqft and 71,000 sqft, respectively.
The flexible workspace market remained active with Spaces’ acquisition of the 121,000 square foot, 125 Deansgate – the largest deal concluded in the city centre last year. This is likely to be a management contract arrangement between the landlord and Spaces however details are confidential.
Other flexible office providers to commit to workspace in the city include WeWork at Hyphen taking 51,000 sqft, Huckletree taking 25,800 sqft at the Express Building in Ancoats, and Regus taking 26,350 sqft at St James’s Tower.
What sort of office space options are there in Manchester?
There is a diverse supply of office space to rent in Manchester from loft office space in the Northern Quarter, beautifully refurbished Grade-B office space in various locations across the city to Grade-A BREEAM excellent office space in Manchester’s traditional core, Spinningfields, St Peter’s Square and other locations.
There are several leasehold options where a landlord and tenant enter into a leasehold arrangement. These leases are can be anywhere from 3 years to 15 years, typically although there are often break options meaning that a tenant can leave early if they serve the appropriate notices with the correct timing. Landlords can also take back the space before the end of the lease under certain circumstances.
There are several serviced office space options in Manchester where an occupier enters into a licence agreement with an office provider/operator. The occupier pays a monthly licence fee and this cover rent, service charge, utilities, furniture, cleaning, reception staff costs and so on. The terms are shorter and contracts are flexible. Licences can normally be drawn up in a matter of hours and occupiers are not held by any onerous lease terms.
Managed offices spaces in Manchester are available also. These are bespoke arrangements made between a managed office space provider and a tenant. They allow an occupier to customise their space and brand it as they desire. They can also have additional services provided such as receptionist services, broadband, IT support and many other customisable features. There is a lease in place but this is between the landlord and the managed office provider. There are many advantages to this bespoke office space solution depending on specific requirements. These options are best suited for companies with a requirement for 20+ desk spaces and looking to take space for longer than one year.
There are several co-working spaces in Manchester in all office space locations. These include Hot Desks whereby a user pays a fee and takes a desk that’s free at that time – and plugin and get to work. These are also known as ‘Floating Desks’. There are also Dedicated Desk options whereby a higher fee is paid and this effectively makes the desk yours (whilst you are paying a fee).
How much is office rent in Manchester?
The record headline office rent in Manchester city centre for leasehold space was broken in 2019 with JLL paying £36.50 per square foot at Landmark in St Peter’s Square.
Other brand new Grade A options in the city centre are now likely to achieve headline rents north of £30 psf and incentives such as rent-free periods and capital assistance will vary from deal to deal.
Second hand Grade B space varies considerably depending on location, property and condition.
Business rates are determined by the Rateable Value (RV) of a property which is set the Valuation Office Agency (VOA). The RV is what the VOA determines is the equivalent of the rent for one year. The RV is multiplied by a factor known as the Uniform Business Rate (UBR) this varies every year but is usually around 50 pence. If the RV of a property is £30 psf then the business rates will be circa £15 psf.
The service charge for an office is the cost of maintaining the fabric and common areas of a building so includes the insuring, cleaning, power in the common areas, the servicing of lists, decorations, the security staff costs, the sinking fund for future repairs and so forth. This varies considerably depending on the format and condition of the building and what kind of services are included.
For Grade A office space service charge tends to be around £5 – £7 per square foot.
With flex space options including serviced offices in Manchester, the tenant pays one fee on a monthly basis and this covers rent, business rates and service charge and also other occupancy-related costs like utilities, cleaning, furniture, broadband and so forth.
Serviced office costs in Manchester range from property to property and vary depending on the total number of desks required, current availability, the length of term desired, the type of services desired and so on. Serviced offices in Manchester cost from around £150 per desk per month to around £450 per desk per month.
Coworking spaces are similar to serviced offices in the sense that the costs are fully inclusive. The costs of coworking space again varies across the city and from building to building and ranges from £100 to £300 per desk per month.
How do you go about finding and securing office space in Manchester?
When deciding on finding business space in Manchester, and indeed any location, it is important to consider many factors. These can be physical factors such as how much is required, are lifts necessary, what cabling is required, is car parking required and so on. The geographical location needs to also be considered; does the office space need to be close to public transportation, close to clients, suppliers and so on.
There are many factors to consider and it is often useful to employ an office agent. A Manchester office agent should have excellent local market knowledge and will be able to walk you through various workspace options. You can then carry out an exercise that breaks down and compares leased options and flex space options.
They will arrange tours and viewings and will negotiate on your behalf liaising between you, the landlord and the landlord’s agent. They will also carry out negotiations on your behalf and will liaise with your solicitor in the drawing up of the lease.
Side note: when taking leased office space and indeed entering into any form of contract or lease, it is highly recommended to employ the services of a solicitor.
A leasehold office agent in Manchester will typically charge a fee equivalent to 10% of the first years’ rent.
Shameless plug alert: If you are unsure of where to start in your Manchester workspace search, get in touch with us and we can talk you through the various options in much greater detail and in a manner more specific to your requirements. We can further explain the differences between serviced offices, leased offices and other options. We can also arrange tours of flex space options, provide negotiation support and help you secure the space. Our services are free because we are paid a fee by the office providers and operators.
What sort of support is there for businesses in Manchester?
There is a high level of support for start-ups, SMEs and other forms of enterprises in Manchester. A good place to start in finding out about support to start is with Manchester City Council and checking out the ‘Business and Investment’ section of their website.
Other institutions that provide support for businesses investing in Manchester include the Business Growth Hub which is based at Lee House on Great Bridgewater Street.
Details of Manchester’s inward investment body, MIDAS, can be found on the Invest in Manchester website. This body acts on behalf of the ten Local Authorities of Greater Manchester, works to attract inward investment into the City Region
The North West Fund also provides direction to support for businesses in the North West.
Manchester is a key city in the ‘Northern Powerhouse’ which is defined as the government’s ‘vision for a super-connected, globally-competitive northern economy with a flourishing private sector, a highly-skilled population, and world-renowned civic and business leadership.’ Details of the support provided which includes networking events, campaigns and marketing, and links to the government, can be found on the Northern Powerhouse website.
Is it easy to recruit staff in Manchester?
There are several universities and further education establishments in Manchester city centre and throughout Greater Manchester and the North West. Manchester is a city that holds onto its graduates due to the diverse economy and business ecosystem; it has been quoted as retaining 60% of its graduates.
Therefore, there is a rich pool of well-educated talent from which to choose from.
It also regularly appears close to the top of rankings of best cities to live in in the UK so the appeal of the city is strong. Therefore, it is not difficult to convince people to work in Manchester or to move from another city to work in Manchester.
For the above reasons, there is a wide variety of recruitment agencies in Manchester; some that are specialised in one or two industries and some that cover many.
Below are the details of some of the agencies that are based in the city:
Digital Gurus, Tootal House, Spring Gardens, Manchester M2 1FB
Hexa Services, Deva Centre, The Cottages, Trinity Way, Manchester M3 7BE
NES Global Talent, Station House, Stamford New Rd, Altrincham WA14 1EP
Bedenoch and Clark, Spring Gardens, Manchester M2 2BY
Morgan Hunt, Acresfield, Exchange St, Manchester M2 7HA
What are the transport links in Manchester like?
There are 4 mainline train stations in Manchester city centre; Manchester Piccadilly, Manchester Oxford Road, Manchester Piccadilly and Deansgate.
Greater Manchester has a network of 600 bus routes and there are over 120 bus stops in Manchester city centre so it is easy to commute by bus.
There is also a free bus service that operates within the city centre and links the main thoroughfares with the main commercial districts.
There are ‘Cycle Hubs’ in the city centre that provide secure parking for your bike in exchange for a monthly fee. Some also have showers and lockers.
There is one at Oxford Road Train Station and there is one in the basement of City Tower in Piccadilly Gardens.
There are several car hire companies based in Manchester doing both daily, weekly and linger hire contracts but there are also several companies that will rent cars by the hour.
There are several car parks throughout the city centre operated by NCP, Q-Park and local operators, too.
What’s it like to live in Manchester?
Manchester has a great nightlife, great shopping, a full and diverse calendar of music and sporting events, great restaurants, art galleries and much more. It was once said that Manchester has everything except for a beach and that feels very true. And even though it doesn’t have a beach, you can hop on the motorway and you can have the sand between your toes in about an hour.
There is a wide variety of places to live where you will be in easy commuting distance of the city centre. There are the great suburbs of south Manchester including Didsbury and Chorlton, the suburbs to the north including Whitefield and Prestwich, to the east including Ashton, and to the west you have locations like Salford Quays. All of these are easily commutable to the city centre.
There are many options for city-centre living, too. There are apartment schemes dotted all over the city centre and clusters in areas such as the Green Quarter near the Manchester Arena, Greengates which is technically Salford but is just steps from Manchester city centre, Spinningfields has several hundred high-end apartments, and there is Castlefield which is like a small village within the city centre. There is range of new apartments here, converted warehouses and mills that are set in the Castlefield canal basin which is a waterside oasis just minutes from the hustle and bustle of Deansgate.
Are there good amenities in Manchester?
There are excellent amenities in Manchester city centre and due to the size of the city, they are all easily accessible.
Although many people will commute into the city centre by bike, not many will navigate the city centre or move from one end of the city to the other during the day by bike. It is fair to say that it is not a particularly bike-friendly city, currently, anyway.
But that absolutely doesn’t matter because it is simple to use the trams to get from one end of the city to the other. It is also easy to hop on the Manchester free bus which navigates the city centre and stops at all the useful spots.
It is also of the size that you can easily walk the whole city. You can walk from one end of the city centre, say Castlefield to NOMA in less than 30 minutes. And you can walk a loop of the city centre in about an hour, so everything is easy to access.
The city centre is a shopper’s dream; from independent record shops in the Northern Quarter to department stores like Harvey Nichols to luxury boutiques in Spinningfields, and everything in between selling everything from rare trainers to snowboarding equipment.
Equally, you will find a truly eclectic range of restaurants from Greek delicatessens to Argentinian steak houses, tapas bars to tea shops and everything in-between. Manchester is very proud to have recently been awarded its first Michelin star in 40 years in the Northern Quarter Mana restaurant.
You will find a selection of gyms from 24/7 unmanned gyms to highly-specified gyms run by international football teams.
In terms of temporary accommodation, you will find plenty of Airbnb options, budget hotels to international 5-star hotels and boutique hotels.
You can find further details of amenities together with their addresses on this Manchester Directory of Resources that we have produced.
Outro
Manchester is expected to see 12% of office employment growth over the next five years. This growth will be helped by Greater Manchester having one of the largest creative and digital clusters in the UK which employs 63,000 people and generates a GVA of £3.1 billion each year.
With new developments and office space deals in the pipeline, it is an exciting office space market to be watching.
So, that’s our overview of Manchester city centre as a place to live and work, an overview of the office space market, various workspace options and so on.
Although it doesn’t replace having a conversation with an office broker in Manchester, however, we hope it’s been of some use.
If you require any further information or would like to discuss your specific requirements, just get in touch and we’ll be happy to help.
The audio version of Choosing Office Space to Rent in Manchester is available on the link.