The UK commercial property market in general has not been particularly affected by the Brexit vote.
Commercial property – offices
Leeds city centre saw strong levels of commercial property demand in 2018, with take-up exceeding the 5-year average.
Hillview Real Estate bought Leeds commercial property in December 2018, saying that whilst Brexit has lead to a climate of uncertainty, it has also had the effect of suppressing prices and the appetite of foreign investors. This has created an opportunity for UK investors to establish regional property portfolios. Following Brexit the government has the opportunity to boost the UK economy through investing in the regions which will boost the commercial property sector.
Many major companies are moving back office functions to lower cost areas, dubbed ‘north shoring’. Leeds is an attractive option for commercial occupiers. The cost of real estate and employment here gives us a competitive edge over the other 9 regional markets. Leeds also has great rail, air, and road connections. It’s an attractive place to live with its premier retail offerings and a better quality of life than London.
Recent and prospective relocations to Leeds are proof of our pudding. Burberry and TalkTalk have implemented or announced plans to relocate. More recently, Channel 4 chose Leeds over Birmingham and Manchester to move its HQ to.
Such moves create jobs and attract further investment and development in the city, and so Leeds will go from strength to strength.
In 2017 Leeds commercial property rents reached record highs, topping £30 per square foot. Overall office supply in Leeds continues to fall, contributing to sustained rents, with increases expected in the coming years.
Next to London, Leeds is the largest financial and business centre in England. It has a strong banking and financial sector, and is seeing excellent growth in the retail, construction and media & technology industries.
Commercial property – Retail
Retail is also hot property in Leeds. The city has been a thriving retail centre for over a hundred years. Trinity and Victoria Gate malls have recently added to the city’s 19th century covered retail space. There has been a lot of activity by brands looking to consolidate multiple high street shops into flagship stores. Stores vacated under Company Voluntary Arrangements have also created opportunities for relocations.
Sites are being re-purposed as well. easyHotel has taken on The Scala Theatre, which was previously used for storage by Miss Selfridge. The hotel, opened in September 2018, is the company’s first hotel in Leeds – and Yorkshire (along with Sheffield).
On the outlook for retail property in Leeds:
“Looking to the future, Leeds still provides excellent opportunities for the expansion of existing brands and for new retailers to enter the market. There are currently more than 60 live requirements for Leeds city centre and just over 60 units available in the central retail core, however most are far from the correct match. As leases come to an end and pitches have changed, we expect to see a repositioning for some retailers which will unlock space for unsatisfied live requirements.