Key takeaways

1. Manchester is set to undergo a major transformation with the approval of a new government office complex focused on technology and innovation.
2. Occupiers are continuing to increase their office footprints, with the TMT sector seeing the biggest increase, driven by Autotrader.
3. As competition intensifies for prime accommodation, refurbishments are emerging as frontline solutions.
4. Manchester remains the only city in the 'Big Six' that has new office development coming through in the next three years.
5. The top achieved rent stands at £45 per sq ft, with Savills forecasting this could rise to £52 per sq ft by the end of 2026, representing growth of 16%.

Manchester has been recognised by NatWest as the UK’s leading business powerhouse outside London, thanks to its dynamic economy, thriving tech and creative sectors, and strong start-up culture. This momentum is fuelled by strategic infrastructure investment, world-class university talent, and attracting major occupiers.

Manchester’s knowledge-intensive industries are expected to be among the city’s fastest-growing sectors, with information and communication, and professional, scientific and technical activities projected to record 2.6% and 2.8% average annual GVA growth, respectively.

By 2028, these sectors are forecast to make up nearly a quarter (24%) of Manchester’s overall economy when measured in GVA. EY’s latest Regional Economic Forecast claims that by 2028, Manchester’s local economy is expected to be more than £2.9 billion larger than in 2024 when measured by GVA, driven in part by the city’s buoyant tech sector and growth in professional services.

Manchester’s ability to attract both national and international companies, combined with its high graduate retention and expanding digital ecosystem, continues to position the city as a premier location for business growth outside London. In 2024, Manchester was officially ranked second only to London for Foreign Direct Investment (FDI) in the UK, according to the EY UK Attractiveness Survey 2025.

Manchester’s appeal is boosted by a graduate retention rate exceeding 50%—the highest among UK core cities. With over 32,000 graduates annually, the city also attracts 16,000 from other regions of the UK, with 14% entering science and tech (11% above the national average). The city is a magnet for innovation-led growth.

This strong foundation of talent, innovation, and investment is further supported by Manchester’s evolving urban infrastructure, where strategic planning is reshaping how people live, work and move through the city. Manchester’s Transit-Oriented Development (TOD) strategy is reshaping the city centre and supporting office market growth by concentrating high-density, mixed-use development around key transport hubs.

By improving accessibility and promoting walking, cycling, and public transit, TOD reduces car dependency and makes commuting more sustainable.

Enhanced public realm and active travel infrastructure also improve the city experience, supporting ESG goals. Offices near TOD hubs, such as Piccadilly, Oxford Road, and Mayfield, are increasingly attractive to occupiers seeking well-connected, future-proof locations.

Crucially, Greater Manchester’s Bee Network committee has approved millions in funding for a wide-ranging pipeline of transport infrastructure projects aimed at improving connectivity, resilience and accessibility across the city region.

Investment in the Northern Powerhouse and enhancements to Salford Central Station, active travel schemes, and digital upgrades to travel information are helping to create a more modern, inclusive and sustainable transport system. These improvements are making commuting more convenient and attractive, directly supporting city centre growth by enhancing access to key employment hubs and reinforcing the appeal of centrally located, well-connected workplaces.

Manchester’s office market: expanding and evolving

Manchester’s office market continues to demonstrate resilience, supported by the Professional Services, Tech, and Education sectors. These industries are not only sustaining demand but actively shaping the city’s future as a hub for innovation, talent, and business services. The Education sector has seen a continuous trend in Manchester, with 70,000 sq ft transacted in 2025 year to date, and with 80,000 sq ft either under offer or in the market for the remainder of the year, this trend is expected to continue.

The Professional Services sector remains a key driver of demand, accounting for 10% of office take-up in the first three quarters of 2025, with this percentage due to increase significantly during Q4. Notably, in Q4, JMW signed a 15-year lease for 42,260 sq ft across four floors at 125 Deansgate, consolidating its Manchester workforce into a single, high-spec office. The move reflects the firm’s expansion to over 600 staff and its ambition to create a modern, agile workplace in a landmark city centre location.

Additionally, Browne Jacobson recently almost doubled its presence in Spinningfields. The firm expanded from 6,700 sq ft to 11,342 sq ft at No.1 Spinningfields, relocating to the entire 15th floor on a new ten-year lease. This reflects a broader trend of occupiers committing to larger, premium spaces in central locations. Professional firms continue to expand their footprint, drawn by Manchester’s deep talent pool, strong transport connectivity, and growing reputation as a centre for innovation. Demand for high-quality space— particularly in fringe submarkets offering scale and flexibility—is fuelling both take-up and rental growth. Since 2021, more than half of office movers in Manchester have increased their footprint. Softcat, for example, relocated from Universal Square (16,450 sq ft) to Manchester Goods Yard (35,391 sq ft), marking a 115% increase.

Adding further momentum, the new government tech campus in Ancoats, (a welcome addition to the new government space in First Street) will bring together departments, embedding the digital side of government within Manchester’s growing tech ecosystem. Spanning 5.5 acres and designed to accommodate up to 7,000 civil servants, the development marks one of the most significant public sector investments in the UK in recent years. More than a relocation, it’s a strategic move that reinforces Manchester’s position as a national centre for digital policy, AI development, and data governance—driving long-term occupier demand and investment confidence. This is expected to boost demand for nearby office space and strengthen Manchester’s tech ecosystem.

Manchester’s ability to attract and retain occupiers across a range of industries—particularly those seeking modern, ESG-compliant space—continues to underpin its market strength. As innovation districts like Circle Square evolve, they are becoming key destinations for occupiers looking to scale in a city that offers both connectivity and character. There have been notable deals at 3 Circle Square this year, with Autotrader moving into 130,000 sq ft of space in Q1, and the likes of Havas and PUMA, who have leased 31,000 sq ft and 20,000 sq ft, respectively.

Public-private leadership has driven Manchester’s regeneration—unlocking investment, creating jobs, and attracting top occupiers through strategic urban transformation

Manchester’s evolution into a city of distinct, thriving districts is underpinned by sustained public-private collaboration, with Manchester City Council playing a pivotal leadership role. These strategic partnerships have unlocked investment, delivered large-scale regeneration, and reshaped the city’s commercial and cultural landscape.

Spinningfields is a prime example. Once a neglected area, it was transformed through a £1.5 billion joint venture between Allied London and the Council. Civic leadership was instrumental in enabling planning, infrastructure, and placemaking that turned the area into Manchester’s financial core, now home to leading occupiers and premium office space. To the north, NOMA—one of the largest regeneration projects in the North West—was delivered through a partnership between the Co-operative Group and the Council. The Council’s proactive role in enabling development and supporting infrastructure created a campus-style district that attracts a diverse mix of tenants.

Looking ahead, one of the city’s most transformative schemes is Mayfield, a £1.5 billion regeneration project delivered by The Mayfield Partnership (Landsec, Platform4, Manchester City Council and TfGM). Adjacent to Piccadilly Station, the development will unlock 1.6 million sq ft of prime office space and create thousands of jobs, demonstrating the power of public–private partnership in bringing a long-derelict site back into public use. The first office building, Republic, is already under construction. It will provide 243,000 sq ft of high-quality workspace and is due for completion in 2028, setting a new benchmark for the district.

At the heart of the project is Mayfield Park, the city’s first new public park in over a century. Currently 6.5 acres, it will expand significantly as the wider scheme progresses and will eventually double in size. The multi-award-winning park, which has the River Medlock meandering through, reflects Manchester’s commitment to wellbeing, sustainability and inclusive growth by improving air quality, supporting biodiversity and elevating the experience for workers, residents and visitors alike.

Manchester’s evolution into a city of distinct, thriving districts is underpinned by sustained private-public collaboration

Adding to this momentum is Sister, formerly known as ID Manchester—a new science and technology innovation district being delivered over the next 15 years. A joint venture between The University of Manchester and Bruntwood SciTech, Sister will transform the university’s former North Campus into 2 million sq ft of innovation and science space. As part of the Greater Manchester Investment Zone, it is expected to generate over 10,000 full-time jobs and contribute around £1.5 billion annually to the local economy. The district recently launched its first building, the Renold Building, with Sustainable Ventures confirmed as its first occupier.

Refurbishments ‘Fill the Gap’ in Manchester’s office market

Manchester’s office market is experiencing a well-documented shortage of ‘best in class’ space. As occupiers increasingly prioritise location, sustainability, digital infrastructure and employee experience, demand for high-specification offices is intensifying. Yet, the availability of true Grade A space remains tight, and the development pipeline is constrained. Just 318,000 sq ft of new-build space is currently under construction—29% below the five-year average.

The top achieved rent stands at £45 per sq ft, with Savills forecasting this could rise to £52 per sq ft by the end of 2026, representing growth of 16%. If a pre-let new build were secured, Savills predicts that rents could rise to £60 per sq ft by 2030, representing an increase of 33% on current rental levels.

With new-build activity limited, landlords are responding with a wave of high-quality refurbishments. Notably, 75% of the office space expected to be delivered over the next three years will come from refurbished stock—a significant shift from the pre-Covid norm. This reflects how the market is adapting to meet evolving occupier expectations.

Rents rise as refurbishments compete with new builds

Due, in part, to the lack of new-build development, quoting rents for refurbished stock have surged. At 3 Hardman Street, a recent refurbishment has seen quoting rents rise from £36.50 per sq ft (pre-refurbishment) to £41 per sq ft in Q2 2025—an increase of 12%; however, upper floors will be quoting up to £45 per sq ft.

Refurbished offices in prime city centre locations are no longer viewed as second-tier alternatives. Instead, they are commanding competitive rents and, in some cases, outperforming new developments. The rental gap between new builds and refurbished offices has narrowed significantly, with the average difference now just £2.50 per sq ft—half the gap recorded in 2019, with this likely to narrow as quoting rents on refurbishments start to increase. This convergence highlights the increasing value occupiers place on well-executed refurbishments that deliver both location and performance.

Case Study: Pall Mall Court

One of the most compelling examples of this trend is the transformation of Pall Mall, a Grade II-listed modernist building in Manchester’s King Street district. The building is undergoing a deep retrofit led by Bruntwood SciTech, with 85,000 sq ft of premium workspace due for completion imminently.

The refurbishment is targeting net zero carbon operation and an EPC A rating. Amenities include a wellness studio, rooftop terrace, contemplation room, and a large cycle hub—all designed to support ESG goals and employee wellbeing. Bruntwood SciTech also acquired the adjacent Pinnacle building, enabling the integration of both properties and the extension of shared amenities. This strategic clustering has driven a 60% uplift in rental values at Pinnacle, which is now fully let.

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