Take-up of office space in Cardiff has rebounded back to pre-pandemic levels.
New figures from property advisory firm Savills, show deals totalling 121,000 sq ft in the first quarter (Q1) of this year.
It represents the highest Q1 take-up since 2019, and 214% above Q1 2021.
Grade A take-up accounted for three quarters (74%) of total take-up in Q1, a 150% increase in the number of grade A deals completed compared in Q1 last year -highlighting significant demand for high quality offices.
Total supply increased in the quarter to 1.65 million sq ft which represented a 16% increase from Q4 ,2021. However, with a limited development pipeline and a strong start to 2022 in terms of take-up, Savills predicts that supply in the market will reduce in the remaining quarters of the year.
The TMT (telecommunications, media and technology) sector was the most active sector in Q1 , accounting for 60% of overall take-up. This included the 65,000 sq ft letting to BT at Capital Quarter, the largest letting so far this year. BT has taken space at the 3 Capital Quarter office scheme vacated by insurance to loans group Admiral.
Office deals in the TMT sector totalled 72,000 sq ft in the quarter - surpassing the annual 2021 total by over 200%.
While there was no change in the prime rent in Cardiff (£25 per sq ft), Savills expects it to grow for the first time in six years to reaching closer to £30.00 per sq ft by the end of the year.
Gary Carver, director in the office agency team at Savills’ Cardiff office, said: “This has been an excellent start to the year for the Cardiff office market. Whilst hybrid working is likely to remain, there is a clear demand for high quality office, sustainable office accommodation, with companies keen to improve the quality of space and design of their workspace in order to attract staff back to the workplace more regularly.”
