Cardiff office property market enjoys bumper year
The Cardiff office property market saw take up leap to 581 643 sq ft in 2024, the highest annual take up since 2017 according to new research from global property consultancy Knight Frank.
Take up for the year was more than double the total for the previous 12 months, with a strong final quarter contributing 247,137 sq ft, the highest quarterly return since Q3 2017.
Mark Sutton, Office Agency partner in Knight Frank’s Cardiff office, said: “There were 92 office deals concluded in the year with an average deal size of 6,322 sq ft, more than double the figure for last year and 40 per cent ahead of the 10 year average.”
The Knight Frank research revealed that prime rents moved onto £28 per sq ft in Q3, with occupiers continuing to focus on prime space with just 16 Grade A deals accounting for 45 per cent of the quarter’s take up.
Mark Sutton said: “With continued demand for the best quality space we will see the availability of Grade A space continue to decline in 2025 and this will translate to further pressure on rents, pushing them beyond £30 per sq ft this year.”
Office vacancy rates inclusive of out-of-town areas stood at 11 per cent at the end of 2024.
“The stand out deal of 2024 was Lloyds Bank signing up to take a lease of 1 John Street, a stand alone 113,000 sq ft office building at the head of Callaghan Square in the heart of Cardiff’s CBD,” said Mark Sutton.
“The building is designed to Breeam Excellent certification and will include a roof terrace and fitness suite and will be completed later this year with Lloyds Bank due to complete its move in Q2 2026.”
Other notable deals in the city centre included PWC signing up for 33,166 sq ft at 1 Central Square, and Aldermore Bank’s move across to the 28,098 sq ft 2 Central Square, along with the sale of the 50,934 sq ft Wilcox House at Celtic Gateway. Cardiff Gate led the out of town deals with Welsh Government’s acquisition of the 51,411 sq ft Centre 7 to create a new hub for the semi-conductor industry.
Overall, the Financial Services and Banking sector took centre stage in 2024 with the 17 deals in this sector totalling 253,057 sq ft and accounting for more than half of the year’s total take up, High-profile deals in the sector also included expansion from Starling Bank at Brunel, and Go Compare’s move to Hodge House.
Looking at availability in 2025 Mark Sutton said: “With no new buildings being delivered in 2025 the severe lack of prime office space will be a continued trend for the year ahead. Grade A availability has dropped below 300,000 sq ft and with several live requirements between 15,000 and 50,000 sq ft the competition for space is hotting up.
“The market continues to polarise and there is activity where landlords have created – or are investing to create – a suitable standard of office space with the right environment and amenities. Secondary locations or where landlords have not yet invested will continue to struggle. We are seeing better occupancy levels across the sector with businesses using flexible workplace strategies but with an increased focus on staff being in the office. Businesses remain focused on creating a better environment to achieve corporate goals, retain and attract staff and to future proof their occupational assets.”