From shortage to opportunity: Bristol’s office market reimagined

The office market in Bristol is undergoing a period of significant change, marked by both opportunity and constraint. As businesses across the UK reassess their workplace strategies, demand for high-quality, flexible office space is rising. Yet, despite this growing appetite, there remains a critical shortage of prime commercial developments coming to market, particularly for occupiers seeking larger floor plates.

The mismatch between demand and supply is becoming increasingly apparent. While several new schemes have planning consent due to viability issues, the pace of delivery has not been maintained with the needs of a market that is rapidly evolving. However, the case for development is becoming more compelling as Bristol continues to have one of the highest prime rents across the UK Big 6 markets, and has experienced Prime rental growth of 28% since the end of 2019. With further growth projected in the next five years, it is anticipated that Bristol will achieve £54 per sq ft by 2029, if not before, representing an increase of 13%.

In Bristol, these pressures are compounded by a limited pipeline of new developments. However, one project stands out as a potential game-changer: the University of Bristol’s £500 million Temple Quarter Enterprise Campus. Strategically located next to Temple Meads station, this ambitious development is set to host 4,600 students and 650 staff, with accommodation for 3,600 students on nearby Temple Island. But its impact extends far beyond academia.

The Temple Quarter campus is revitalising a long-derelict industrial zone into a vibrant, mixed-use innovation district. It is designed to foster collaboration between academia, business, and the wider community, creating a fertile environment for startups, spinouts, and corporates. The Centre for Innovation and Entrepreneurship, housed within the campus, is expected to be a magnet for high-growth companies and a driver of demand for flexible, high-spec office space in the surrounding area.

The economic ripple effects are already being felt. According to a 2025 report by Oxford Economics, the University of Bristol contributed £1.13 billion to the West of England economy and £1.78 billion nationally in 2022/23. These figures are projected to rise to £1.17 billion locally and £1.95 billion nationally by 2028/29, supporting over 18,000 jobs in Bristol and nearly 29,000 across the UK.

For developers and investors, the message is clear: the Temple Quarter Enterprise Campus is not just a university expansion – it’s a catalyst for commercial growth. It is already encouraging the refurbishment of older buildings to meet modern sustainability and tech-readiness standards, and it is expected to unlock new opportunities for office development in one of the city’s most strategically important locations.

Beyond the numbers, the campus represents a bold vision for Bristol’s future. It aligns with the city’s ’One City’ plan, which aims to create a fairer, healthier, and more sustainable urban environment. As such, the Temple Quarter is more than a regeneration project; it is a symbol of Bristol’s ambition to become a global leader in inclusive, innovation-led growth.

In a market facing both constraints and change, the Temple Quarter Enterprise Campus offers a rare combination of scale, vision, and momentum. It may well be the spark that reignites Bristol’s commercial property pipeline.

Mind the gap: Why refurbished offices are set to surge

Across the UK’s regional office markets, the flight to quality continues to shape occupier demand, and nowhere is this trend more pronounced than in Bristol. The city is facing a growing shortage of prime office space, with less than 360,000 sq ft available. For occupiers seeking larger floorplates and modern amenities, options are becoming increasingly limited.

Among the Big Six regional cities, Bristol stands out as having one of the most constrained development pipelines. With new builds lagging behind occupier needs, refurbished buildings are stepping in to fill the gap. These spaces are no longer viewed as second-tier alternatives; instead, they are commanding increasingly competitive rents and attracting strong interest from quality-conscious tenants.

Over the past year, refurbishment rents have risen sharply across the UK’s core regional cities. The rental gap between new builds and refurbished offices has narrowed significantly, and in some markets, such as Glasgow and Edinburgh, refurbishment rents have even surpassed those of new developments. Bristol currently has the widest rental gap between new builds and refurbished offices among the Big Six cities.

However, with the tightest supply of prime space, this gap is expected to close quickly as demand intensifies and refurbished stock becomes more competitive. As competition for high-quality space grows, well-executed refurbishments are emerging as premium offerings in their own right. This presents a compelling opportunity for landlords with space returning to the market to reposition their assets. At the same time, occupiers with upcoming lease expiries are under increasing pressure to reassess their property strategies and begin conversations early to secure the best available options.

Looking ahead, the next wave of refurbishment projects in Bristol is likely to set new benchmarks for quality, sustainability, and rental performance, significantly redefining the city’s office landscape in the process, which has already been seen in buildings such as Crescent (as seen below), which is now 32% let, to companies such as OVO and Michael Page.  With the dwindling availability of best-in-class space in Bristol and a constrained development pipeline, the opportunity for developers and investors is now.

Savills research shows that across the Big 6, a significant pre-let above 20,000 sq ft could push rents into new rental highs, and Bristol certainly has this potential. With less than 360,000 sq ft of prime available space in the market, development is needed to accommodate the increased occupier preference for best-in-class.

If a pre-let were to be secured in the city, this could lead to £56 per sq ft and above being achieved in the short term, representing an increase of 16% on the current headline rent. This will only continue to increase as demand continues, and make Bristol a prime location for investors and developers. Will this potential unlock development viability within the city?

Supercomputers and smart cities: Bristol’s AI revolution

Bristol is rapidly solidifying its position as the UK’s leading hub for artificial intelligence research and innovation.

When the UK government announced last September that the University of Bristol was selected to host one of the world’s most powerful supercomputers, it was, according to the university’s Professor Simon McIntosh-Smith, “a huge leap forward for AI computational power in the UK.”  The Bristol-led hubs are among nine in total nationwide: three progressing mathematics and computational research crucial to AI and six exploring AI for science, engineering, and real-world data. Bristol experts will be working with various hubs across the UK, including Lancaster and Edinburgh.

Bristol is cementing its position as a national leader in AI, thanks to two new AI research hubs at the University of Bristol backed by £21 million in UKRI funding. These hubs – AI for Collective Intelligence (AI4CI) and INFORMED-AI – are part of a wider £80 million national initiative and will drive innovation across healthcare, public health, smart cities, finance, and environmental systems.

AI4CI will develop systems that harness distributed intelligence from people and devices to improve decision-making at both individual and societal levels. Applications range from personalised healthcare guidance for diabetes patients to smarter NHS policy design. INFORMED-AI, meanwhile, will explore how networks of AI systems can collaborate more effectively, with a focus on trust, security, and resilience – critical for sectors like energy, transport, and communications.

This research is not only advancing AI theory but also reinforcing Bristol’s role as a magnet for talent, investment, and innovation. The city’s growing ecosystem – bolstered by the arrival of Isambard-AI, the UK’s most powerful supercomputer – makes it a prime location for tech-driven growth. Bristol is one of only two UK cities leading multiple national AI hubs, placing it at the heart of the UK’s AI future.

With over 6,000 students graduating annually in STEM disciplines and a thriving tech sector employing more than 35,000 people, Bristol offers a unique blend of academic excellence and commercial opportunity. The city’s real estate market is also responding, with increased demand for high-spec R&D and innovation space. As AI reshapes industries, Bristol is not just participating – it’s leading.

Taking Flight: How Bristol’s Aerospace Sector is Shaping the Future

The aerospace and advanced engineering sector remains a cornerstone of Bristol’s economy, valued at over £2.7 billion.

The region is home to more than ten world-leading aerospace companies, including Airbus, Rolls-Royce, GKN Aerospace, BAE Systems, and Leonardo Group. These firms are supported by a robust supply chain and a highly skilled workforce, with over 51,000 jobs in aerospace, manufacturing, and advanced engineering across the West of England.

Bristol is also a hub for cutting-edge research and development. The National Composites Centre (NCC) and the Centre for Modelling & Simulation (CFMS) are based here, making the region the UK’s leading centre for composites R&D. These institutions support innovation in lightweight materials, robotics, and additive-layer manufacturing.

Rolls-Royce’s FutureWorks facility in Bristol is pioneering digital aerospace manufacturing, contributing to the Future Combat Air System (FCAS) programme. The site is experimenting with technologies like Additive Layer Manufacturing (ALM), Augmented Reality (AR), and Digital Twins, aiming to create a fully digital, paperless factory environment.

Sustainability is also a key focus. Airbus is developing its ZEROe hydrogen-powered aircraft in the region, while GKN Aerospace is leading the £54.4 million H2GEAR project, advancing hydrogen propulsion systems.

With four world-class universities and over 39,000 STEM students, Bristol offers a deep talent pool and a collaborative ecosystem that continues to attract global investment and innovation in aerospace.

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Further reading:

Market in Minutes: Bristol Occupational Office Data Q1 2025