Levelling out Manchester Crane Survey 2020 Contents
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Levelling out Manchester Crane Survey 2020 Contents Foreword 01 Development snapshot 02 Key findings 03 Residential 04 Office 16 Retail, leisure and hotels 24 Student, education and research 30 Development map 34 Endnotes 36 Contacts 37 Why? Where? What? A report that measures the volume of Central Manchester and Salford Developers building new schemes or development taking place across City Centre, excluding MediaCity:UK undertaking significant refurbishments Central Manchester and Salford City exceeding any of the following sizes: Centre and its impact. Property types office – 10,000 sq ft; retail and leisure include residential, office, hotel, retail 10,000 sq ft; residential property and leisure, student accommodation, – 25 units; education, health care education and research facilities, and research – 10,000 sq ft; hotel and health care. – 35 rooms. When? orthern Gatewa Data for the Crane Survey was recorded between 11 January 2019 and 13 December 2019. Central Salford Eastern Cit Core Gatewa How? The local Deloitte Real Estate team Spinningfields/ has monitored construction activity St Johns and planning permissions granted over a number of years, supplemented Southern Arc by rigorous field research. This research has been verified by industry contacts and in-house research teams. Levelling out | Manchester Crane Survey 2020 Foreword As a consequence, 2019 has seen a number of developers seeking to promote alternative models of city centre accommodation in the form of co-living aimed at a target market which includes the young talent needed to continue to support a dynamic and growing core to the conurbation. This has prompted Manchester City Council to develop guidelines to inform their decision making processes in relation to co-living schemes. Office construction volumes have almost doubled John Cooper during 2018 and 2019, and remain at just over 2 Partner, Planning million sq. ft. The Telecommunications, Media and +44 161 455 6512 Technology (TMT) sector has delivered the highest [email protected] take up of available space in 2019, with serviced office/ co-working operators featuring strongly, together with legal and professional as well as public sector in the It is striking that this year’s survey results show 27 form of HMRC’s relocation. A highlight for us this year schemes completing, the 3rd highest year on record. has been completion of the Grade II Listed Hanover This is a reflection of the exponential increase in House at NOMA and the decision taken by Amazon development activity which has been reported to occupy their first UK corporate office outside during the period 2013-2018 and has transformed London. A further feature of the office market is the Manchester’s and Central Salford’s skyline in recent broader range of products and locations beyond the years. Looking ahead to 2020, the rise in completions traditional city core. will continue with a record 47 schemes reportedly due to come to market. Manchester’s success and growing popularity as a destination for both domestic and international This years’ results also show a slight reduction in tourists was further underlined in 2019 by data new starts. This could suggest that last year’s record reporting that Manchester has overtaken Edinburgh results, in terms of overall activity, may prove to have as the most popular tourist destination outside been a peak in the current development cycle. To be London. This is evidenced by Manchester’s strong clear however, the latest results still represent one of hospitality sector which has seen 3,000 new hotel the highest levels of construction activity since our rooms come into the market since 2014 and 2,446 records began in 2002, and given the geo-political further beds currently under construction over 11 uncertainty experienced in recent times, this is a different sites. Occupancy rates remain high and further testament to the city’s market strength, Manchester’s depth and variety of accommodation profile and resilience. is key to Manchester’s ability to attract and support major events around sport, live entertainment and The slight reduction in construction activity this year culture, for which the city is famous. can largely be attributed to the residential sector. There are a number of factors including the large The range and quality of new development coming numbers of units coming to market, greater challenges forward is exciting. We look forward to witnessing around forward funding for the Build to Rent sector, the current pipeline come to fruition and in turn availability of land at the right price and increasing supporting the next waves of major regeneration construction costs to name a few. activity in the city. 01 Levelling out | Manchester Crane Survey 2020 Development Snapshot Key findings Sectors under construction – total schemes 2 2 5 Retail/ Student 11 Research/ Leisure Residential 14 Hotel Education 43 Office Residential The overall number of residential The number of units completed 77 units under construction is down 3,619 represents the highest Schemes u/c on the previous year at delivery since 2006 (4,196). 12,357 units (14,480 units in 2018) 2020 could see the delivery of 8,880 units. New starts per survey 2015 New office space completed is 40 per cent of the office floorspace 2016 427,410 sq ft during 2019, on par currently under construction is 2017 with the average for the last pre-let (865,500 sq ft), with 17 years. The volume under 40 per cent of that taken up by 2018 construction is above 2.1m sq ft for the the TMT sector. 2019 second consecutive year. 0 10 20 30 40 50 Office Retail/Leisure Residential Student Hotel Education/Research Other The number of hotel beds under Although no additional research There are construction continues to rise, or educational space was Residential units under construction with 2,446 new beds on site delivered during 2019, over and 344 new beds delivered 1.28m sq ft remains under 2,446 during 2019. construction across 5 schemes for hotel rooms under 12,357units, delivery during 2020 and 2021. construction across 27 with schemes 11 schemes, with have 620 new beds There are a total of 77 schemes 390,500 sq ft of retail and leisure completed, commencing units which is the 5,203 on site currently, with a space is being constructed 2nd highest development (42%) located in Salford. 48 per cent reduction in the as part of office or on record. during 2019. number of new starts during 2019 residential schemes. compared to 2018 (23 down from 44). Retail and leisure space under Office space under construction construction totals 2,089,500sq ft 513,678 sq ft, which is boosted by the 865,500sq ft commencement of world-class Pre-let (40% of Grade A space). multi-arts venue, ‘The Factory’. This has the potential to create15,500 new FTE jobs in the Manchester and Salford combined by 2021. 02 Levelling out | Manchester Crane Survey 2020 Development Snapshot Key findings Sectors under construction – total schemes 2 2 5 Retail/ Student 11 Research/ Leisure Residential 14 Hotel Education 43 Office Residential The overall number of residential The number of units completed 77 units under construction is down 3,619 represents the highest Schemes u/c on the previous year at delivery since 2006 (4,196). 12,357 units (14,480 units in 2018) 2020 could see the delivery of 8,880 units. New starts per survey 2015 New office space completed is 40 per cent of the office floorspace 2016 427,410 sq ft during 2019, on par currently under construction is 2017 with the average for the last pre-let (865,500 sq ft), with 17 years. The volume under 40 per cent of that taken up by 2018 construction is above 2.1m sq ft for the the TMT sector. 2019 second consecutive year. 0 10 20 30 40 50 Office Retail/Leisure Residential Student Hotel Education/Research Other The number of hotel beds under Although no additional research There are construction continues to rise, or educational space was Residential units under construction with 2,446 new beds on site delivered during 2019, over and 344 new beds delivered 1.28m sq ft remains under 2,446 during 2019. construction across 5 schemes for hotel rooms under 12,357units, delivery during 2020 and 2021. construction across 27 with schemes 11 schemes, with have 620 new beds There are a total of 77 schemes 390,500 sq ft of retail and leisure completed, commencing units which is the 5,203 on site currently, with a space is being constructed 2nd highest development (42%) located in Salford. 48 per cent reduction in the as part of office or on record. during 2019. number of new starts during 2019 residential schemes. compared to 2018 (23 down from 44). Retail and leisure space under Office space under construction construction totals 2,089,500sq ft 513,678 sq ft, which is boosted by the 865,500sq ft commencement of world-class Pre-let (40% of Grade A space). multi-arts venue, ‘The Factory’. This has the potential to create15,500 new FTE jobs in the Manchester and Salford combined by 2021. 03 Levelling out | Manchester Crane Survey 2020 Residential 04 Levelling out | Manchester Crane Survey 2020 Significant but reduced activity Residential development (77 schemes) accounted for 56 per cent of all construction projects between January 2015 and December 2018, highlighting the recent prominence of the sector for development activity in Manchester. Growth since 2015 means that 12,357 residential units are currently under construction in the area covered by the survey. The number of units completed in 2019 This year's Crane Survey found 11 new reached 3,619 in the survey area residential schemes commencing, the (Chart 1).