Notably, the quarter’s increase was driven by the biggest ever office letting in Wales to date – 266,000 sq. ft. at 6 Central Square to the Government Property Unit, which accounted for almost 75% of the take-up for Cardiff. City centre locations accounted for 333,679 sq ft, compared with out of town locations which accounted for 17, 921 sq ft. Overall, 20% take-up was Grade B office stock, and 80% Grade A.
Aside from HMRC, significant lettings for the quarter included Friary House to Cardiff University, Brunel House to Legal and General, and Callaghan Square to Aon Benfield. Smaller Cardiff Bay lettings included Drake Walk to Rockadove, and Mount Stuart Square to Cinemattic.
Tim Lawley, Associate Director at Cooke & Arkwright, specialising in office and industrial agency, said: “It’s been an unprecedented bumper two-year period for Cardiff, largely due to the major city centre office developments, and landmark lettings to the likes of the BBC, Motonovo, and Hugh James.
“Similarly, the substantial GPU pre-let to accommodate the HMRC relocation from Llanishen in 2020 has had a major impact on the figures for this quarter, and for the year as a whole. If it wasn’t for this deal, the year’s outcome would look very different.
“This underlying dip behind the large deals in the Cardiff office market could stem from a lower level of availability, with city centre office supply in Cardiff now down to 707,505 sq. ft., some 18% down on figures reported in Q1 2016.
“With a large proportion of the existing Grade B supply already given over for alternative uses such as student residential accommodation, the market is looking to landlords to retain and refurbish the existing stock for commercial use, to complement the Grade A developments currently in the pipeline.”