21 Nov 2018
A new report from Knight Frank, titled Catching the Next Wave – Manchester, Technology & Real Estate, has highlighted Manchester as a centre for technology business.
The report observes tech’s recent growth in the city, along with the sector’s influence, the many possibilities available and how developers and landlords can attract tech occupiers.
“Manchester has a tremendous opportunity to catch the next wave of technological progress and extend its global influence and reputation as a tech centre,” said David Porter, head of office, Knight Frank Manchester.
The technology, media and telecoms (TMT) sector has grown from 14% in 2013, to 40% at the end of Q3 2018 – when seen as a percentage of total office take-up. Additionally, the number of deals in the sector has increased from 63 in 2013 to 106 in 2017.
Between 2013 and 2017, IT and telecoms companies were responsible for most of the space taken up by tech companies – at 767,712 sq ft. Media, marketing and entertainment were next in line, at 712,083 sq ft.
Mark Bamber, partner, office agency, at Knight Frank, said: “The take-up figures show the huge growth potential of tech. Manchester, which has good universities and is a young, dynamic city, is a good place to take advantage.”
In order to illustrate the growing demand for space dedicated towards tech occupiers in Manchester, Mark Bamber spoke of two recent deals. In June, Bet365 bought the 75,000 sq ft Zenith building in Manchester’s Spring Gardens for £31.5m – which, at the moment, it occupies a third of. Four years ago, the company’s office in the city was only 5,000 sq ft.
Later in August, Booking.com merged the four Manchester city centre offices it once operated from by taking 220,000 sq ft at the Goods Yard at St John’s Quarter in Allied London’s Enterprise City tech campus on a 12-year lease. The new location, being the new head office for the group’s ground transportation division, Rentalcars.com, will begin by housing 1,500 staff.
Bamber points out that developers and landlords are adapting to the new tech wave by accommodating businesses with flexible workspace – such as large open-plan floors that offer room for growth. Communal lounges and breakout space encouraging collaboration are also being constructed, allowing for services to be exposed in accordance with businesses' fit-out specifications, while also enhancing connectivity in buildings.
Porter says that it will be important for landlords and developers to accommodate a wider range of tech businesses as various new sectors – including neuro-technology, regenerative medicine and synthetic agriculture – begin to emerge.
“Fast-moving tech occupiers are prepared to pay a premium for turnkey space and the flexibility to scale up or down to align more closely with business planning,” Porter adds. “They want spaces that encourage collaboration between co-workers and work environments and services that attract and retain this talent.
“Investors and developers have to respond to it if they are to create buildings that are attractive not just to tech occupiers but to businesses of all types. It is ultimately the key to capturing the next wave of occupiers.”