A new record for Bristol offices rents is predicted to be set before the end of the year as availability levels continue to fall.
Latest market figures for the second quarter of 2018 show that Grade A sector vacancy levels now stand at 1.5% in the city centre and 3.1% out of town.
“We are likely to see another record rent in Q3,” said James Preece, national offices director in the Bristol office of real estate services company Colliers International.
"The second quarter has seen a much-needed improvement in the out of town market following a very poor Q1. A new prime rent has been set and the half year take-up is 15% up on the same period last year. The city centre remains very robust with a large turnover of transactions and rents continuing to be pushed upwards."
Mr Preece said that the shortage of Grade A space in Bristol city centre was particularly severe.
"Grade A availability has decreased by 57% since this time last year and now stands at c. 33,700 sq ft., leaving Grade A vacancy at only 1.5%. Overall City Centre vacancy stands at 6.1%," he said.
"With very little Grade A space available, it is unsurprising that rents have remained at £32.50 per sq ft; however, this looks set to change in the third quarter."
Mr Preece added that Bristol's out of town market had an impressive Q2, with the number of transactions up 27% quarter on quarter. The largest transaction by some margin was the purchase of HP3 & HP4, Stoke Gifford by UWE which accounted for more than 75,000 sq ft of take up, followed by ALD taking a lease of 27,250 sq ft at Building 1, Harlequin Office Park.
"At 171,000 sq ft, the half year take-up is 15% up on the same period of 2017 and 8% up on the 5-year average," he said.
"A new prime rent has been set at 140 Aztec West where £22.50 per sq ft has been achieved on a letting of 6,000 sq ft.