The Cost of UK Office Space 2025

Challenges remain, as hybrid working patterns and stricter EPC regulations push landlords to upgrade lower-grade properties. The gap between premium and secondary spaces continues to widen, reinforcing a two-tier market where only energy-efficient, future-ready assets meet tenant expectations.

Looking ahead in 2025, London’s resilience depends on its ability to adapt to hybrid work trends, stricter regulations, and tenant priorities for ESG compliance. Flexible leasing models, enhanced amenities, and sustainable design will be key to maintaining the capital’s position as a global office leader.

The city’s office market continues its upward trajectory, with take-up at the end of 2024 reaching 432,700 sq ft, a 32% quarter-on-quarter increase and the strongest quarter since 2019. The standout deal of the quarter was Bank of New York Mellon’s 200,000 sq ft lease at 4 Angel Square, the largest in four years, highlighting the demand for high-quality, Grade A spaces.

Prime rents remain at £44.00 per sq ft, reflecting a 2.3% annual increase. As the UK’s highest-renting city outside London, Manchester is expected to see rents grow to £46.00 per sq ft in 2025 and £48.50 by 2027, driven by strong demand and limited availability of premium spaces.

Upcoming projects like The Island, St. Michael’s, and 3 Circle Square will add 940,000 sq ft of new and refurbished space, with 49% pre-let. As businesses focus on ESG-compliant spaces to attract talent, Manchester’s reputation as the UK’s leading regional office market is set to strengthen further, with ongoing upward pressure on prime rents.

Manchester is innovative, competitive and attractive to investors yet reasonably priced. There is a variety of tenants from companies with regional or global headquarters which include adidas, Siemens, Kellogg’s and Baker Tilly LLP.

The most popular areas to rent office space in Manchester are:

• Central Core
• Piccadilly
• Spinningfields
• Ancoats and Northern Quarter
• Salford Quays
• Media City
• Manchester Airport

The city’s office market closed 2024 with remarkable momentum, achieving a take-up of 348,690 sq ft—a 106% increase quarter-on-quarter and the highest since 2017. This growth was largely driven by significant transactions in the education and professional services sectors, with city centre activity accounting for most take-up. Demand for Grade A, high-quality spaces remains strong, though availability is critically low at just 2.3%, slightly down from the previous quarter.

Prime rents held steady at £42.50 per sq ft, reflecting a 5.5% year-on-year increase. Forecasts suggest continued upward pressure on rents, which could reach £48 per sq ft by 2028, as ESG-compliant, amenity-rich spaces dominate occupier preferences.

Birmingham’s position as a key business hub is bolstered by increasing interest from national and international firms relocating from London. Landmark developments such as 103 Colmore Row, Enterprise Wharf, and One Centenary Way are attracting occupiers with sustainable designs and world-class amenities. Future phases of the Paradise development will also contribute much-needed Grade A stock.

As demand for premium office spaces continues to outstrip supply, Birmingham is solidifying its role as a leading regional business destination, offering competitive opportunities for occupiers and investors alike. Its tenant profile varies from National Express, N Power, Deloitte, KPMG and Cadbury.

The most popular areas to rent office space in Birmingham are:

• Birmingham Central
• Digbeth
• Solihull
• Eastside
• Westside

Brighton remains a highly sought-after location for businesses, underpinned by its reputation as a creative and innovative hub on the south coast. In 2024, Brighton’s office market continues to reflect both the opportunities and challenges of high demand amidst constrained supply.

A fast-growing TMT sector is causing demand for space to outweigh current availability.

Brighton’s development pipeline remains tight, with just two key schemes, including the Portland Building, expected to deliver much-needed high-quality space. The overall supply levels, particularly for Grade A properties, remain critically low, with most availability concentrated in Grade B stock. If demand remains high then £42 per sq ft is very possible in 2025 with rental fees already increasing c.4% year on year.

Brighton’s tenant profile includes American Express, Domestic & General, Octopus Energy, Paxton Access, and Brand Watch.

The most popular areas to rent office space in Brighton are:

• City Centre
• North Laine
• South Laine

The professional services, government services and consumer private sectors accounted for 63% of all transactions in the past year. Key deals in the most recent quarter included BLOCK’s 21,235 sq ft lease at The Fairfax and Turner & Townsend securing 9,715 sq ft at Temple Point.

Bristol’s availability rate rose slightly to 8.7%, with premium Grade A space remaining tight at just 2.5% availability. The ongoing demand for high-quality office space has prompted rental growth, with projections suggesting continued upward momentum as the market adjusts to the current undersupply.

Looking ahead, 567,000 sq ft of speculative space is set to complete in the next year, including prominent developments like The Welcome Building, 3 Rivergate, and The Crescent. This pipeline, combined with robust demand for best-in-class space, indicates a strong potential for further prime rental growth in the year to come.

Bristol’s tenant profile varies from the Ministry of Defence, Airbus, Rolls Royce, Aviva, RAC and Hargreaves Lansdown.

The most popular areas to rent office space in Bristol are:

• Temple Meads
• Broadmead
• Clifton
• Aztec West

The city continues to cement its status as a global hub for innovation, particularly in the life sciences sector. Recent government ambitions to drive rapid residential and commercial development highlight the city’s potential for unmatched growth. However, challenges around infrastructure, sustainability and affordability must be addressed to fully capitalise on this opportunity. Cambridge stands as a key player within the Golden Triangle, where its position as a hub for investment, development and talent is bolstered by significant construction activity and strong venture capital inflows.

Take-up across the Golden Triangle, including Cambridge, reached 84,400 sq ft in the most recent quarter. Cambridge itself remains constrained by supply shortages, with a vacancy rate of just 1.3%. This highlights the ongoing demand-supply imbalance in the city, even as 124,000 sq ft of new construction was delivered in Q3 2024. Looking ahead, the speculative under-construction pipeline for the Golden Triangle totals 3.7 million sq ft, with Cambridge positioned as a major beneficiary of future completions.

Prime headline quoting rents in Cambridge are holding steady at £62.50 per sq ft. This stability reflects the continued premium placed on best-in-class life sciences and office spaces. Cambridge’s rental figures are indicative of its appeal to a growing number of occupiers seeking access to its world-class ecosystem.

The most popular areas to rent office space in Cambridge are:

• City Centre
• Cambourne
• Cambridge Science Park

The Leeds office market demonstrated remarkable resilience at the back end of 2024, with take-up reaching 259,265 sq ft, representing a 77% quarter-on-quarter increase. While this figure is 4% below the 10-year average, demand for high-quality Grade A office spaces remains strong, accounting for 40% of total take-up in Leeds.

Key leasing activity included NG Bailey’s 25,230 sq ft lease at Arlington Business Centre and University of Law’s 15,241 sq ft lease at Yorkshire House, reflecting the city’s appeal across a range of sectors. The Financial Services, Professional Services, and Government sectors were dominant, collectively accounting for 70% of take-up over the last year.

Prime rents in Leeds rose to £39.00 per sq ft at the end of 2024, reflecting a 2.6% increase over the previous quarter, with the market continuing to push for quality spaces. The availability rate dropped to 5.4%, signalling tightening conditions, particularly for premium office stock.

Looking ahead, Leeds is expected to remain a regional powerhouse, attracting investments and tenants seeking cost-effective yet high-quality office solutions. With a stable development pipeline and a focus on modern, sustainable spaces, the city is poised to sustain its growth trajectory in 2025

The tenant mix in Leeds varies from Asda, Capita, Jet2, Sky and GHD.

The most popular areas to rent office space in Leeds are:

• Leeds Central
• Wellington Place
• Burley
• Beeston
• Pudsey
• Hunslet
• Thorpe Park
• Kirkstall Forge

Liverpool’s office market showed a notable uptick in activity at the end of 2024 despite a difficult H1, with take-up reaching 85,900 sq ft, marking a 34% increase above the five-year quarterly average. The professional services sector led demand, accounting for 31% of take-up, with TMT and creative industries following at 19%.

The most recent quarter’s most significant deal was the Home Office’s 24,700 sq ft lease at The Capital Building on Old Hall Street, the largest transaction since Q4 2023. Other notable deals included Mitchell Charlesworth’s 11,103 sq ft lease at The Plaza and Acorn Insurance’s 7,932 sq ft lease at Edward Pavilion. Despite the activity, availability fell by 4% to 867,100 sq ft, with second-hand space continuing to dominate the supply (90%).

Prime rents remained steady at £35 per sq ft, demonstrating Liverpool’s resilience in maintaining competitive pricing in the face of rising activity. Development completions in 2024 totalled 63,650 sq ft, including refurbished space at No. 12 Princes Dock and The Martins Bank Building. Looking ahead, 103,106 sq ft of speculative space is under construction, signalling further opportunities for growth.

Its tenant mix varies from Jacobs Crackers, Unilever, Typhoo and The Very Group.

The most popular areas to rent office space in Liverpool are:

• City Centre
• St Paul’s
• The Docks
• Knowledge Quarter
• Wavertree Technology Park

Premium space is still in demand but this is currently undersupplied, with the availability rate for Grade A space at 1.4%. This has led to prime rental growth over the last 12 months which now sits at £32 per sq ft — up 14.3% from last year and 10.3% from the previous quarter.

Looking ahead, Newcastle’s development pipeline shows cautious optimism, with 32,000 sq ft of space completed in 2024 and larger projects, such as HMRC’s 464,000 sq ft Pilgrim Place office, due for completion by 2027. This substantial project is expected to address Newcastle’s Grade A supply-demand imbalance and catalyse further economic activity in the city.

Its tenant profile varies from Sage, Greggs, Virgin Money and Accenture.

The most popular areas to rent office space in Newcastle are:

• Quayside
• Grey Street
• Newcastle Helix
• Cobalt
• Quorum

The manufacturing, industrial, and energy sector dominated take-up in the past 12 months, accounting for 34% of total demand. This was followed by the consumer services and leisure sector, which contributed 27%. The largest deal of the quarter was Nucleome Therapeutics’ 19,900 sq ft lease at Inventa, Botley Road, demonstrating the continued attractiveness of the city for cutting-edge industries.

Prime rents in Oxford remain robust at £62.50 per sq ft, reflecting the market’s enduring appeal. However, as is true across the Golden Triangle, addressing infrastructure limitations, improving commercial accessibility, and ensuring housing affordability will be essential to unlocking Oxford’s full potential.

The most popular areas to rent office space in Oxford are:

• Oxford Science Park
• Oxford Business Park
• Bicester
• Abingdon

Its proximity to London, combined with strong transport links via the Elizabeth Line and the M4 corridor make Reading a prime location for businesses seeking strategic connectivity and cost-effective alternatives to the capital.

The South East office market has seen an increase in demand for Grade A office space, and Reading is no exception. The town is benefitting from an evolving occupier preference for high-quality, sustainable buildings that support hybrid working and employee wellbeing. Despite this demand, the availability of premium office space in Reading remains constrained, with vacancy rates for Grade A properties notably lower than for older stock. This tight supply has maintained prime rents at a competitive £50 per sq ft, with Reading outperforming other towns in the region.

Investment activity in Reading also reflects broader trends in the South East, with institutional investors continuing to show interest in properties offering long-term income security. As sustainability becomes a key driver for both occupiers and investors, developments in Reading have increasingly incorporated ESG considerations, enhancing the town’s appeal to forward-thinking businesses.

Looking ahead, Reading’s position as the economic heart of the Thames Valley, coupled with its access to a highly skilled workforce, will ensure its continued prominence in the South East office market. As new developments and refurbishments come online, the town is well-placed to capture growing demand from occupiers seeking flexible, well-connected, and sustainable office spaces.

Its tenant profile includes companies such as Microsoft, Vodafone, Oracle and Prudential.

The most desirable areas to rent office space in Reading are:

• Town Centre
• Green Park
• Thames Valley Park
• Caversham