After a year of prolonged uncertainty, research has shown that Manchester’s recovery is underway. According to the latest data fromAvison Young’s UK Cities Recovery Index, the city’s commercial activity is performing at a promising 92.8 – a clear indication that Manchester is beginning to emerge from the shadows cast by COVID-19.
Avison Young has created the UK Cities Recovery Index to help monitor the way in which the pandemic is impacting the UK’s major cities. It enables up to date assessments and analysis of the rate and trajectory of the recovery and identifies trends that will determine the future of the property sector, cities and of society as a whole.
The Sector Indices are combined into an overall Recovery Index score, which illustrates the evolution of urban impact and recovery over time since 29th February 2020, before COVID-19 hit the UK.
Although there is still a long way to go, the latest Recovery Index data reveals that all business confidence surveys have recovered from the six-month low in January, with Manchester recording 106.6 at the end of March, similar to the national figure. This is just shy of the previous high of 108 at the end of July and compares to 37.2 at the end of April last year.
As would be expected, other sector indices, such as retail, hotels and leisure, have all increased since lockdown restrictions lifted on 12th April, with non-essential retail, as well as outdoor hospitality all now open. The past week has seen a sharp increase in the hotels and leisure sector index, from 20.7 on the 11th April to 33.1 on 25th April, with retail peaking at 99.6 on 25th April as footfall soared.
Manchester’s return to office figures are proving slower to recover, with the sector index sitting at 45.3 on 25th April, not far off its previous highest point of 47.8 on 16th September.
While Avison Young’s Big Nine data showed that office take up figures during Q1 of 2021 were below the 10-year average, Manchester still secured the highest lettings figures of the UK cities recorded. This indicates that there is still a healthy demand for a return to office working, with the public sector in particular leading the commitment, following the 30,240 sq ft letting to the NHS at St James’s House in Salford, 24,548 sq ft to the Ministry of Justice at the Redfern building in the NOMA district and the Department for Work and Pensions securing 14,908 sq ft in Stretford.
Commenting on this latest activity, Chris Cheap, Principal and Managing Director of UK Regions at Avison Young’s Manchester office, said: “The dramatic increase in footfall in central Manchester since restrictions were lifted earlier this month has been a huge boost to the challenged hospitality and retail sectors. With people back on the streets, Manchester feels like a city awakened and, with continued positive market signals from the office sector, it is anticipated the return-to-work numbers will see the same uplift on our Recovery Index following the next milestones on the opening-up route map.’
“Although the office market was more subdued than in previous years at the start of the year, against the backdrop of a third national lockdown, Manchester still performed well. Lettings within the quarter continue to illustrate the city’s broad sectoral appeal and ability to offer a range of workspace, which speaks effectively to a variety of audiences. The public sector is an important driver for the market at the moment and we anticipate more of the same as the year progresses and more posts head north as a result of the commitment to ‘levelling up.’
“Although there is still a long way to go, it’s reassuring that the data in both our Big Nine and UK Cities Recovery Index reports confirm the feeling of optimism in Manchester as footfall and sentiment continues to increase.”