Cushman & Wakefield gives its predictions for what’s in store for the Newacstle property market in 2019. Greg Davison, Partner in Office agency at Cushman & Wakefield in Newcastle comments:
“2019 already looks like it could be a busy year. The first speculative office scheme in the region since 2016 will be completed at the Beam in Sunderland, followed by The Lumen at Newcastle Helix in December. Whilst there is a now an established pipeline, there are several larger requirements in the market which, if they all move, could absorb that new stock.
“Regarding rental levels, we have seen a strong period of rental growth in prime city centre rents, driven primarily by lack of supply. We can certainly expect to see £25 per sq ft achieved on the best space during 2019, but I also expect a greater weight of activity in the tier just below that, where I believe we will start to routinely see rental levels reach £22.50- to £23.50 on good quality refurbished space in locations such as Grey Street. This will have a knock-on effect and we expect to see incremental uplifts in rental levels throughout the market.
“The out of town market has been subdued in terms of large transactions; this could change once there is certainly over the UK’s future relationship with Europe, when it is hoped there will be greater opportunity driven by north shoring and re-shoring projects. We expect rental levels in this market to hold firm at around £16.50 per sq ft. Savvy landlords will look at being more proactive with their buildings and delivering a more diverse product offer.”