Overseas investors put more than £60 million into Sheffield’s office market last year, bringing more top quality developments to the city.
The money has led to some of the ‘highest levels of transformation’ in the last decade, according to Peter Whiteley, partner and head of the Sheffield office of real estate consultant Knight Frank.
Mr Whiteley said there were several reasons why 2016 had ‘record’ investment in office developments from foreign parties.
“This is in no small part due to the pace of change and restructuring taking place at the new retail quarter, and prestige properties like Vulcan House at the J2 Riverside Exchange and Riverside East office, home to law firm Irwin Mitchell, have been snapped up,” he added.
The total office take-up in 2016 was 201,500 sq ft, according to Mr Whiteley.
This was down from 480,000 sq ft in 2015 and was 36 per cent below the 10-year average but the figure did not include the 140,000 sq ft of space in the first phase of the £480 million retail quarter, which was leased to HSBC.
Staff visited the site of the old Grosvenor House Hotel for a ground-breaking ceremony earlier this week.
Mr Whiteley also said the referendum had an effect on takeup.
HSBC aside, the biggest deal was professional services firm Arup taking 16,000 sq ft at 3 St Paul’s Place, the final part of the £130 million Heart of the City development near the Peace Gardens.
Mr Whiteley said: “St Paul’s Place is an established commercial development, with earlier phases occupied by DLA Piper, Barclays, Royal Bank of Scotland and PWC.”
This year has almost equalled last year’s total already, with 170,000 sq ft of space taken up.
Knight Frank is marketing Acero, the latest part of the Digital Campus.
“The universities have both expanded into city centre locations, such as Cathedral Court and Velocity,” said Mr Whiteley. “Further, the expansion of the universities has seen some of the older office buildings being converted by the private sector to deliver city centre residential use, which has assisted in re-energising the city centre.
“Sheffield’s relative lack of high specification city-centre office space is being addressed with central opportunities delivering grade A space for both the existing market and potential inward investment enquiries to Sheffield.
“Buildings including 3 St Paul’s Place, Westfield House and Steel City House are well appointed and offer quality working environments.”