UK Office Market Outlook H2 2014

Transcription

1 UK Office Market Outlook H2

2 Regional revival The investment market led the charge in but by year-end the occupational market had matched the pace with all major markets outside London (asides from the Western Corridor) recording strong take-up levels and all of the core eight markets outside London witnessing an increase in active demand. On the back of this 215 is set to be another strong year for the regions. Development activity is underway in all but one of the core eight markets but the level of demand for new Grade A space is outstripping supply with a shortage intensifying in all markets. Strong economic and employment growth, business expansion and confidence in the UK regional market has seen prime rental growth and a reduction in incentives across the majority of markets, which is set to continue in 215.

3 Summary Summary statistics* () (s sq ft) 7,51 7, Big 6 (s sq ft) 4,3 5, +16.3% Vacancy Rate (%) 11.3% bps Average Weighted Prime Rent ( psf) U/C Spec (s sq ft) 2,78 3, * Summary of the core 8 markets outside London: Birmingham, Bristol, Cardiff, Leeds, Manchester, Western Corridor, Edinburgh & Glasgow. Big 6 comprises Birmingham, Bristol, Leeds, Manchester, Edinburgh & Glasgow. UK office rental clock Rental Growth Slowing Rents Falling London West End London City Rental Growth Accelerating Rents Bottoming Out Manchester Edinburgh, Glasgow & West London Bristol & Thames Valley Birmingham, Cardiff & Leeds For information on the Central London market, please see the JLL Central London Market Report UK Office Market Outlook H2 3

4 UK Outlook Highlights take-up exceeds the 1-year average with the Big 6 driving activity alongside a subdued year for the Western Corridor. Vacancy rates fall in all markets, with the Grade A shortage intensifying. Active demand up by over a third year-on-year. Speculative space under construction in all but one market. Prime rental growth seen in majority of markets. Strong levels of investment activity led by the regions. Recovery takes hold The UK economy finished with GDP growth of. in Q4, resulting in total expansion of 2., the strongest annual increase since 27. The recovery has taken hold with job creation across the UK increasing and the unemployment rate continuing to decline, falling below, the lowest rate for six years. Furthermore, the for 215 is positive with the decline in oil prices providing an additional boost for firms and households, leading to lower inflation and thereby reinforcing the low interest rate environment. Therefore, it is anticipated that UK GDP growth will be slightly higher in 215 than the level seen in. Figure 1: GVA Growth across the UK 3% 1% % Manchester Bristol Source: Oxford Economics South East UK Glasgow Edinburgh Leeds in H2 soars as occupier demand strengthens Birmingham Cardiff The regional office markets finished the year in a buoyant fashion as take-up in H2-14 amounted to almost 4.1 million sq ft a rise of 3% from H1-14. After a relatively slow start to the year take-up accelerated in the second half and rose by 3% from 3.2 million sq ft to 4.1 million sq ft. All of the Big 6 markets exceeded their respective 1-year annual take-up average in. Manchester witnessed a spectacular ; with strong occupier demand and an increasing scarcity of good quality space, the city saw just over 1.3 million sq ft transacted over the year, a new record. In contrast, the Western Corridor had a subdued with take-up some 13% below the 1-year annual average and impacted by delayed and protracted decision making by corporates. Two of the most notable transactions of the year occurred in H2-14, with Standard Life Investments taking just over 18, sq ft in Edinburgh and HS2 leasing 1, sq ft in Birmingham. The largest transaction in the Western Corridor in was Fraser Nash acquiring 125, sq ft in Windlesham. Figure 2: Core Markets Outside London - Office s sq ft 9, 8, 7, 6, 5, 4, 3, 2, 1, year average Source: JLL, Core 8 Markets: Birmingham, Bristol, Cardiff, Edinburgh, Glasgow, Leeds, Manchester and Western Corridor There is no sign of the strength of the markets outside London waning with over 9 million sq ft of active demand Looking ahead to 215, there is 5. million sq ft of active demand in the Western Corridor and a further 4.2 million sq ft across the Big 6, up by over a third on. The majority of this is driven by lease events although this is closely followed by business expansion and demonstrates the confidence that is returning to corporates. Lease events are often the trigger for occupiers to implement workplace transformation initiatives and some live requirements are seeking to downsize but upgrade. The acceleration in employment growth is also a strong indicator of increased demand for floorspace. 4 UK Office Market Outlook H2

5 Demand for new Grade A space intensifies supply shortage Total available supply fell across all the core eight markets outside London during with the overall vacancy rate moving in by 17 basis points to 9., the lowest level since Q3 28. Total available supply in Manchester city centre fell by a third during and the West London sub-market fell by one fifth. While take-up is the driving factor behind this reduction, stock has also been lost to other uses, including through Permitted Development Rights. The volume of Grade A supply remains the real pressure point in the core eight markets with the Grade A vacancy rate exceptionally low in Manchester (.), Bristol (1.1%) and Leeds (1.) and is at the lowest level since 21 in the Western Corridor (5.%). Speculative development activity is seeking to address this shortage and at end- there was 3.1 million sq ft under construction across the core eight, up year-on-year. Increasingly this space is being let during construction as occupiers compete for the best quality space coming through including recent transactions to PwC and KPMG in Bristol and Standard Life Investments in Edinburgh. we will see further rental growth. JLL forecasts that prime rents across the UK major markets (excluding London) will show steady growth over , averaging 2.. However, the Western Corridor is expected to outperform the UK major markets, averaging 4. growth per annum. Big 6 dominates investment activity in Investment volumes in the core eight markets outside of London totalled 3.5 billion during, much in line with the 3.6 billion transacted in. However, in the Big 6 accounted for 6 of total investment volumes whereas the previous year the Western Corridor transacted 6% by volume. The largest deal outside of London during was the 32m sale of 1 Spinningfields / 3 Hardman Boulevard in Manchester. Activity in the Scottish markets returned during Q4 following a subdued period in the run up to September s referendum. Figure 4: Share of Investment Volumes 4, The Grade A shortage is the catalyst behind new development but the volume does not match the level of demand and refurbishment opportunities need to be exploited m 3,5 3, 2,5 2, 1,5 1, 5 Big 6 Western Corridor Figure 3: Core 8 Markets Speculative Development Activity 5, 4, Source: JLL Figure 5: Prime Yields Profile 3, 2, 1, Source: JLL Completed U/C Definite Spec Start Likely Spec Start 5/5 Spec Start Rents increasing and incentives reducing Source: JLL 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 Edinburgh Manchester Western Corridor Leeds Cardiff The strengthening occupational market drove prime rental growth in all the core eight markets outside London, aside from Birmingham during, for example prime rents in Manchester increased from 31 to 32 per sq ft and rents in Glasgow increased from 28 to 29. The UK Regional Office average weighted prime rent increased by 3. yearon-year to stand at per sq ft at end-. Incentives have also moved in over the course of with the prime average net effective rent increasing by 6. year-on-year. With Grade A space becoming increasingly scarce in 215, the expectation is that The sheer weight of money targeting South East and Regional offices together with the onset of rental growth drove prime yields in by up to 5 basis points over the course of. Birmingham, Leeds, Manchester and West London show the keenest yields at 5.2, with further yield compression in 215 in the core markets anticipated. We also expect investors to look further afield for suitable investment product and, in that context, smaller UK regional centres and secondary stock will be targeted in 215. UK Office Market Outlook H2 5

6 Birmingham Summary statistics (s sq ft) 713 Figure 6: 8 7 Vacancy Rate (%) 9. Prime Rent ( psf) 28.5 U/C Spec (s sq ft) Investment market Investment Vol. ( m) Prime Yield (%) year average Figure 7: Supply and vacancy rates Market overview 3,5 The Birmingham office market finished the year strongly with Q4 take up the highest quarterly amount for over 5 years. Furthermore, this has resulted in witnessing the most space transacted since 28. The outstanding deal of occurred in the final quarter of the year, with HS2 taking 1,sq ft in the city centre. As a result of the completion of the HS2 transaction and overall market sentiment, the for the market in 215 is optimistic with the expectation of further demand from companies involved with the overall HS2 project. 3, 2,5 2, 1,5 1, 5 Supply (lhs) Vacancy rate (rhs) 1 1 % Supply levels have remained low over the quarter and this has resulted in overall vacancy rates continuing to decline. During, overall vacancy rates have eased from 12. to 9.. The lack of good quality space is particularly apparent, with Grade A vacancy falling from 2. to 1. over the course of the year. There are a number of speculative schemes due to start in 215; therefore the amount of available space will continue to erode. Prime rents were unchanged over the course of, although with good quality space increasingly scarce and occupier demand expected to hold firm, rents are anticipated to come under pressure in 215. Similarly, incentives are expected to tighten further from their current level of 3 months on a 1 year term. Figure 8: Prime rents and rental growth 2.% %.....% Rental growth (y-on-y) (lhs) Prime rent (rhs) per sq ft The investment market performed strongly over the year, with Q4 volumes witnessing 9m of space transacted. This concluded the busiest year for some time as the Birmingham office market saw 565m of transactions over the course of the year. Yields have held firm over the quarter, although over the duration of and reflecting the level of activity, have eased 75 basis points to now stand at 5.2. Figure 9: Prime yields Prime yields 1 year average 2 year average Source all Charts: JLL 6 UK Office Market Outlook H2

7 Bristol Summary statistics (s sq ft) 836 Vacancy Rate (%) 6. Prime Rent ( psf) 28.* U/C Spec (s sq ft) 11 Investment market Investment Vol. ( m) 11.6 Prime Yield (%) 5. * As at Q1 215 headline prime rents are 28.5 Market overview Bristol experienced a strong occupational market during with 835,76 sq ft taken-up in the city centre, a 6% increase on the 5-year annual average (526,4 sq ft) and the highest volume since 27. Despite the impressive take-up volumes just 13,25 sq ft of new Grade A space was transacted, highlighting the continuing shortage of new space. Significant new Grade A transactions include KPMG (52, sq ft at 66 Queen Square) and PwC (28,376 sq ft at 2 Glass Wharf) both occupiers committing to schemes whilst under construction. As Bristol moves into 215 as the European Green Capital we expect continued strong demand in the occupational market with TLT, AXA and Babcock actively seeking space in the city centre. There was a significant reduction in available supply during, with total availability falling by 3 year-on-year, leaving a vacancy rate of 6., one of the lowest of the Big 6 markets. Bristol continues to be impacted by the loss of space to alternative uses with a further 225,4 sq ft being removed from the office stock during. With new space under construction already being absorbed, unless there is a new wave of development activity, the larger Grade A requirements will need to pursue the pre-let route. During Q4 Bristol saw the first increase in headline prime rents since Q4 29, with rents increasing to 28. per sq ft. To date, rents in Q1 215 have increased further to 28.5 per sq ft. Incentives remain in the region of 3 months rent free on a 1- year term. Bristol s city centre investment market was constrained by a lack of available stock during but the 35m sale of Templeback during boosted overall volumes to 12m. There continues to be strong investor interest in Bristol and we expect prices to harden further in 215 as stock becomes available. Figure 1: 1,2 1, Figure 11: Supply and vacancy rates 2, 1,6 1,2 8 4 Supply (lhs) Figure 12: Prime rents and rental growth 3% 1% % Rental growth (y-on-y) (lhs) Figure 13: Prime yields 5 year average 1 1% % Vacancy rate (rhs) Prime rent (rhs) per sq ft Prime yields 1 year average Source all Charts: JLL UK Office Market Outlook H2 7

8 Cardiff Summary statistics (s sq ft) 332 Figure 14: 6 5 Vacancy Rate (%) 8. Prime Rent ( psf) 22. U/C Spec (s sq ft) 232 Investment market Investment Vol. ( m) Prime Yield (%) 6.% 5 year average Figure 15: Supply and vacancy rates Market overview 1,4 1 Cardiff city centre offices experienced a good year in with take-up reaching 332, sq ft, up one third on the previous year and much in line with the 5-year annual average (335, sq ft). Grade A space accounted for 3 of total take-up in with key deals including Blake Morgan Solicitors (28,77 sq ft), Finance Wales (22,324 sq ft) and Equiniti (16,954 sq ft). There is a definite feel good factor in the city following BBC Wales s commitment to Cardiff and with renewed confidence in the market the level of demand is expected to strengthen further in ,2 1, Supply (lhs) Vacancy rate (rhs) 1 1% % Total supply in Cardiff reduced over the course of with the vacancy rate moving in by 5 basis points to stand at 8.. The market has a shortage of Grade A space, which has intensified following a number of transactions in. At year-end just 49,95 sq ft of new grade A space was available in two schemes. New development activity is well underway with One Central Square (14, sq ft but part pre-let to Blake Morgan) and 2 Capital Quarter (8, sq ft) on site. The Welsh Government is also proposing to develop 9, sq ft at Callaghan Square, although the start date is yet to be confirmed. However, there will be a Grade A supply deficit in 215 with 2 Kingsway (4, sq ft) the only refurbishment currently on site. Prime headline rents in Cardiff City Centre remained at 22 per sq ft during but this level is expected to be exceeded during the first half of 215. Figure 16: Prime rents and rental growth 1% % Rental growth (y-on-y) (lhs) Figure 17: Prime yields Prime rent (rhs) per sq ft Cardiff attracts interest from a broad range of investors including the institutions, private and overseas money. The key deal in was the sale of Crickhowell House in Cardiff Bay to a Kuwaiti family trust for 4.5 million (5.3 net initial yield). The strong pricing reflected special circumstances as the building is single let to Welsh Government (18.5 years unexpired) and adjoins their Senedd debating chamber. In addition, Fidelity acquired the multilet Fusion Point 2 for 11.2 million (8. NIY). As further stock becomes available we expect prime and good secondary prices to harden. 9% Prime yields 1 year average Source all Charts: JLL 8 UK Office Market Outlook H2

9 Edinburgh Summary statistics (s sq ft) 891 Vacancy Rate (%) 6.3% Prime Rent ( psf) 3. U/C Spec (s sq ft) 173 Investment market Investment Vol. ( m) 35 Prime Yield (%) 5. Figure 18: 1, year average Market overview After a slight pause in Q3, take up rebounded in Q4 to see just over 27,sq ft transacted over the quarter. This has helped total annual take up to reach almost 9,sq ft, the highest level seen for 1 years. The market has been strong over the year, and occupier demand has held up despite the uncertainty surrounding the referendum. The most notable transaction over the year was in Q4 with Standard Life pre-letting over 1,sq ft in St Andrews Square, with Rockstar Games leasing 75,sq ft in Barclay House the highlight of H1. As a result of increased occupier demand and advancing take up, prime rents have risen over the quarter to now stand at 3 per sq ft. This is the first increase in prime rents for just over a year and highlights both the scarcity of prime space and the robust demand from occupiers. Supply levels have largely held up over the quarter, although vacancy rates have exhibited a downward pattern over the course of the year. Overall vacancy as at Q4 stands at 6.3% falling from 7.1% twelve months ago. Despite an upturn in the amount of space under construction, current levels of supply are constrained and prime space will remain scarce in 215. However, office development will become more viable, these schemes will take time to be delivered, and therefore a rise in pre-let agreements is anticipated in 215. Investment volumes were robust over the year, despite the slight hiatus as a result of the referendum. Overall office investment volumes totalled just over 3m, comfortably above the 5 year average. As a result, prime yields have hardened from in Q4 to now stand at 5. in Q4. Speculative forward funding was also a feature of the market, with 2 new schemes being funded in the city centre. Figure 19: Supply and vacancy rates 1,85 1,8 1,75 1,7 1,65 1,6 1,55 1,5 1,45 1,4 1,35 Supply (lhs) Figure 2: Prime rents and rental growth 1% % - - Rental growth (y-on-y) (lhs) Figure 21: Prime yields Vacancy rate (rhs) Prime rent (rhs) per sq ft Prime yields 1 year average 2 year average Source all Charts: JLL UK Office Market Outlook H2 9

10 Glasgow Summary statistics (s sq ft) 643 Figure 22: 8 7 Vacancy Rate (%) 9. Prime Rent ( psf) 29. U/C Spec (s sq ft) 46 Investment market Investment Vol. ( m) Prime Yield (%) 5. 5 year average Figure 23: Supply and vacancy rates Market overview 2, 1 It was a positive year for the Glasgow office market and finished strongly with take up levels over the year amounting to almost 65,sq ft, exceeding both the 5 year and 1 year annual average. Take up in Q4 amounted to 182, sq ft continuing the robust performance seen in the previous quarter. Key deals over the quarter were Cigna taking 33, sq ft on Gordon Street and the Strathclyde Partnership for Transport (SPT) purchasing 22, sq ft along Vincent Street. 1,6 1, % % As a result of the strong occupier demand seen over the past quarter, prime rents have moved up in Q4 to now stand at 29. per sq ft. After moving in to 24 months rent free on a 1 year term in Q3, incentives were unchanged in the final quarter of the year. In terms of supply, the Glasgow market continues to see the availability of Grade A space tighten, as the vacancy rate eased down over the quarter to is due to see a notable amount of space being delivered to the market; however an increasing proportion is being pre-let, highlighting the current scarcity of good quality space within the market. Therefore, the pre-let route remains the primary option for occupiers looking to secure larger amounts of space. Investment activity was steady in Q4 following the more robust levels seen in Q3. Key transactions over the quarter include the purchase of George House by Ardstone UK for 22.5m and Aberdeen Asset Management acquiring St Vincent Street for almost 28m. As a result of strong investor demand over the year, yields have hardened over the quarter and now stand at 5., some 5 basis point below the same period a year ago. Supply (lhs) Figure 24: Prime rents and rental growth 4.% 3. 3.% 2. 2.% 1. 1.%..% Rental growth (y-on-y) (lhs) Figure 25: Prime yields Vacancy rate (rhs) Prime rent (rhs) per sq ft Prime yields 1 year average 2 year average Source all Charts: JLL 1 UK Office Market Outlook H2

11 Leeds Summary statistics (s sq ft) 544 Vacancy Rate (%) 5. Prime Rent ( psf) 26. U/C Spec (s sq ft) 373 Investment market Investment Vol. ( m) 216 Figure 26: Prime Yield (%) year average Figure 27: Supply and vacancy rates Market overview 1,6 1 The office market in Leeds finished strongly with take up in Q4 amounting to almost 158,sq ft, the highest quarterly figure over the course of the year. Take up in was above the 5 and 1 year average as occupier demand and sentiment within the market was positive. Activity over the year was from a wide range of occupiers from various business sectors, with the most notable transaction over the year occurring in Q4 with Squire Patton Boggs leasing just over 32, sq ft in Wellington Place. 1,4 1,2 1, % % Overall supply levels continued to move down in with vacancy rates currently standing at in Q4. There is an encouraging amount of speculative development underway, although 215 points to a gap in the completion of a number of schemes, therefore pre-lets are expected to become more prevalent in order to satisfy larger space requirements. With the letting to Handelsbanken at Whitehall Riverside at 26 psf prime rents have finally edged forward and there is expected to be growing pressure and a further rise anticipated in 215. Furthermore, incentives have hardened in, with 22 months rent free on a 1 year term as at Q4, a reduction of 8 months over the year. Investor interest continued to be buoyant in Leeds culminating in a very strong end of the year. Overall volumes were 216m with the majority occurring in Q4. With the for occupier demand remaining robust, this has helped to drive investor interest, highlighted by the key transaction of the year, the 9m speculative funding of the Central Square development. Consequently, prime yields have hardened noticeably in, declining by 75 basis points to now stand at 5.2. Supply (lhs) Figure 28: Prime rents and rental growth 1% % Rental growth (y-on-y) (lhs) Figure 29: Prime yields Vacancy rate (rhs) Prime rent (rhs) per sq ft Prime yields 1 year average 2 year average Source all Charts: JLL UK Office Market Outlook H2 11

12 Manchester Summary statistics Figure 3: 1,4 (s sq ft) 1,327 1,2 Vacancy Rate (%) 6.% Prime Rent ( psf) 32. U/C Spec (s sq ft) 286 Investment market 1, Investment Vol. ( m) 1,19 Prime Yield (%) year average Figure 31: Supply and vacancy rates Market overview 3, 1 The Manchester office market witnessed a spectacular, with overall take up levels amounting to over 1.3m sq ft. The take up levels seen in are the highest recorded for the Manchester market and highlights the strength of occupier demand witnessed over the year. With just over 38, sq ft being transacted in Q4, finished strongly, and the largest deal over the quarter was DLA taking almost 45, sq ft at One St Peters Square. The overall vacancy rate continued to move down as demand outstripped supply in. Furthermore, the scarcity of prime space became increasingly acute over the course of the year, with Grade A vacancy, standing at just. as at Q4. However, there were a number of schemes delivered in as the market began to respond to the shortage of space. Although there remains a lack of available space and as a result pre-lets will be increasingly competitive. As a consequence of strong demand and a scarcity of good quality space, prime rents have moved up over the year to historic highs, currently 32 per sq ft, with the expectation of further rental rises in 215. Moreover, incentives have continued to harden and are now between 18 and 24 months rent free on a 1 year term. The regional investment market has witnessed a strong and the exceptional growth in investment volumes in Manchester has reflected this trend. Manchester saw over 1bn transacted over the year, the highest recorded, with the acquisition of Spinningfields for over 3m the outstanding transaction of the year. Investor demand is anticipated to hold up into 215, especially for good quality, well located space. 2,5 2, 1,5 1, 5 Supply (lhs) Figure 32: Prime rents and rental growth 1 1 % Rental growth (y-on-y) (lhs) Figure 33: Prime yields Vacancy rate (rhs) Prime rent (rhs) % % per sq ft Prime yields 1 year average 2 year average Source all Charts: JLL 12 UK Office Market Outlook H2

13 Western Corridor Summary statistics (s sq ft) 2,34 Figure 34: 3,5 3, Vacancy Rate (%) 12. Prime Rent ( psf) U/C Spec (s sq ft) 1,513 Investment market Investment Vol. ( m) 1,66 2,5 2, 1,5 1, 5 Prime Yield (%) year average Figure 35: Supply and vacancy rates Market overview 13,5 1 The occupational market experienced a disappointing year in with take-up reaching 2.34 million sq ft, some below the 5-year annual average of million sq ft. Delayed and protracted decision making by corporate occupiers impacted on overall take-up volumes and activity was dominated by smaller transactions, with only six transactions over 5, sq ft. The for the Western Corridor market during 215 is strong with named active demand increasing by 7 year-on-year to 5. million sq ft. While there may be a pause in activity in the run up to the General Election we expect take-up volumes for 215 to be up at least 2 on the previous year. 13, 12,5 12, 11,5 11, 1,5 Supply (lhs) Figure 36: Prime rents and rental growth Vacancy rate (rhs) 1 13% 1 Supply continues to be eroded due to office take-up and loss of stock due to Permitted Development Rights. The West London market has seen the greatest impact with total supply falling by 1 during to stand at 3.2 m sq ft. The shortage of Grade A remains a pressure point; in West London the Grade A vacancy rate is just 2.. The current wave of speculative development will help to address the Grade A shortage, with 1.5 million sq ft under construction in 15 schemes but further starts on site are needed to match the level of demand coming through. 3% 1% % per sq ft Despite the subdued transactional year, the Western Corridor market continued to see rental growth with average prime rents increasing by 6.% year-on-year to JLL rental growth forecasts show the Western Corridor outperforming UK regional cities, averaging 4. per annum over the period Figure 37: Prime yields Rental growth (y-on-y) (lhs) Prime rent (rhs) The Western Corridor investment market had a strong, with over 1 billion invested. The market was dominated by UK institutions with strong interest from US private equity. We expect demand to remain high in 215, originating from a more diverse investor base, and prices are likely to continue to harden. Thames Valley prime yields 1 year average 2 year average West London prime yields Source all Charts: JLL UK Office Market Outlook H2 13

14 Definitions Floor space acquired for occupation by lease, prelease, freehold or long leasehold sale in the City Centre (unless otherwise stated). All deals are included with the exception of Western Corridor and Bristol where 5, sq ft and 1, sq ft thresholds are applied respectively. Cardiff take-up includes City Centre and Cardiff Bay. Supply Floorspace on the market and available for occupation. It includes space that is under offer. Under Construction Speculative development of new building or substantial refurbishment where construction activity is ongoing. Demand New enquiries logged on a quarterly basis, over 2, sq ft for London and the South East and over 1, sq ft for the regional markets. Prime Rent The JLL view of the highest rent achievable for a hypothetical 1, sq ft unit of Grade A space in a prime location, without any adjustment for incentives. Business Sectors Broad business sectors are classified as: Banking & Finance: Banks and other financial institutions Professional Services: Accountants, legal, management consultants etc Service Industries: Advertising and PR, broadcasting, internet services, printing and publishing, software houses and data processing, telecommunications services, transport, retail, leisure etc Manufacturing Industries: Pharmaceuticals, computer hardware, electronics, construction, mining, engineering, food and drink etc Public Administration & Institutions: Central and local government, institutions, charities, quangos, health and social etc Investment Volumes Investment volumes include city centre investment volumes, quoted in GBP (grossed up). 14 UK Office Market Outlook H2

15 Contacts BUSINESS CONTACTS Jeremy Richards Head of National Offices Bristol +44 () Angus Minford Capital Markets +44 () Mark Wilson Capital Markets +44 () LEASING CONTACTS Jonathan Carmalt Birmingham +44 () Andrew Pearce Exeter +44 () Matthew Smith Nottingham +44 () Ian Wills Bristol +44 () Mike Buchan Glasgow +44 () David McGougan Southampton +44 () Rhydian Morris Cardiff +44 () Jeff Pearey Leeds +44 () James Finnis Western Corridor +44 () Cameron Stott Edinburgh +44 () Chris Mulcahy Manchester +44 () Chris Hiatt London West End +44 () UK Office Market Outlook H2 15

16 Contacts INVESTMENT CONTACTS Ross Burns Glasgow +44 () Simon Merry North West +44 () Ben Kelly Midlands +44 () Olly Paine South West +44 () Justin Millett Cardiff +44 () Andrew Summersgill North East +44 () Chris Macfarlane Edinburgh +44 () Colin Finlayson Edinburgh +44 () RESEARCH CONTACTS Ben Burston UK Research +44 () Vicky Heath UK Research +44 () Barrie David UK Research +44 () barrie.david@eu.jll.com UK Office Market Outlook H2 jll.co.uk COPYRIGHT JONES LANG LASALLE IP, INC.. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of Jones Lang LaSalle. It is based on material that we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any warranty that it contains no factual errors. We would like to be told of any such errors in order to correct them.