Belfast office market remains buoyant entering into the new year

Whilst the office market in Northern Ireland got off to a relatively slow start in the first half of 2017, with only 14 transactions totaling 164,472 sq ft of take-up, the second half finished in a considerably stronger position.

There were 33 transactions completed in H2 2017, bringing the yearly total of office take-up to 430,290 sq ft. The five-year annual rolling average equates to 385,034 sq ft.

David Wright, director, CBRE commented: “The low volume of transactions and take-up recorded in the first half of the year was not an accurate reflection of the activity in the local office market.

“Take-up in the last six months has emanated from a wide range of FDI companies taking new space, as well as local companies relocating into larger office accommodation due to significant growth in their own respective businesses.

“Going forward, interest in the market remains healthy and the take-up recorded in the second half of 2017 strongly supports this view.”

Notable deals completed in 2017 include HMRC at Erskine House; HCL at Millennium House; Grant Thornton at Donegall Square West; First Derivatives at The Weaving Works; Deloitte at Lincoln Building and TP iCAP, Wireless Group and ITV at City Quays 2.  Headline rents for best in class buildings have reflected £20.00 per sq ft to £21.50 per sq ft. CBRE anticipate rents increasing during 2018 to £22.50 per sq ft headline.

Mr. Wright added: “Refurbished properties such as Linen Loft, Flax House, The Weaving Works and Lincoln Building have delivered much needed stock into the market and the completion of River House in Q2 2018 will provide a further boost to supply and choice in the market.”

Significant projects for 2018 include the 212,000 sq ft Merchant Square building on Wellington Place with works due to begin early in Q1 2018 with delivery expected in Q1 2019 and Chichester House, 46,000 sq ft, currently on site.

A number of other Grade A office schemes have planning permission in Belfast city centre, although in the absence of a major pre-let many are unlikely to start in 2018.