Office rents in Sheffield have risen faster than in any other 'big ten' regional cities over the past year, a new report has revealed.
Rents have risen 47 per cent since the global financial crash in 2008, significantly more than rival cities which were up 25 per cent in the same period, new figures show
Top-end rents in Sheffield are now £26 sq ft - but still less than other big cities which are £35 sq ft.
Experts say higher rents attract more investors so more offices get built. More choice drives competition among developers resulting in better quality offices - which attract more companies.
The statistics were from commercial property analytics provider CoStar Group. It found in the last year office rents in Sheffield, Cardiff, Liverpool and Newcastle rose faster than in Birmingham, Leeds, Bristol, Edinburgh, Glasgow and Manchester.
Of all 10 cities Sheffield leads the way, according to Guy Cooke, director at BNP Paribas Real Estate UK and member of Sheffield Property Association.
He added: “The office market is in the best shape it has been for decades, the growth and investment prospects are evident. However, the market urgently needs more space to sustain the city and help attract inward investors. Most of the Grade ‘A’ buildings are full, which is stimulating new development activity and we will see a return to pre-lets.
“Whilst rents have been rising, Sheffield still remains relatively affordable compared to the other big cities. A lower cost base and excellent demographics make Sheffield an attractive proposition to invest.”
Much of the “positive momentum” can be credited to Sheffield City Council and the emergence of Sheffield Property Association, according to Tim Bottrill, director of commercial property agency colloco and one of the founding members of the S-PA.
The authority has invested in 3 St Paul's Place and the soon-to-be completed Grosvenor House, the new flagship office for HSBC that forms the first part of the Sheffield's £470 million Heart of the City scheme.
He added: “These prudent investments have, in turn, given confidence to private investors. Top-end rents continuing to rise is a huge positive for Sheffield.
"The opportunity for landlords to earn more provides a greater confidence in the city. It means commercial property developers are far more likely to build new office space speculatively, rather than relying on a tenant to commit to a long lease before submitting a planning application.
"This in turn adds competition amongst developers and you'll see the quality of office space step up significantly. All of this will make Sheffield far more attractive to some of the UK's biggest companies. Small, medium and large businesses all benefit by having more choice."
Established in 2017, the S-PA is an independent association of land owning and development businesses in Sheffield. It has 62 members including aad Architects, British Land, Henry Boot, Mott MacDonald, RBH Properties, Scarborough Group, Sheffield Hallam University, Wake Smith Solicitors and Whittam Cox Architects.