Manchester is the UK’s most attractive destination for financial services firms leaving London, according to new data from JLL.
This has seen the city benefit from an influx of investment, as a growing exodus of firms from the capital fuels commercial property growth in regional cities – and this trend is only expected to continue, with a number of further deals already in the pipeline.
The new research shows how the banking and finance sector has accounted for more than 440,720 sq. ft of new office space across Glasgow, Leeds, Bristol, Manchester, Edinburgh and Birmingham[1] in terms of inward investment deals over the last decade.
This is more space than both the manufacturing and services sectors, which accounted for 238,822 and 224,813 respectively, though less than TMT and flexible office space.
Manchester attracted the largest square footage of inward investment from financial institutions between 2015 and 2024 (153,830 sq. ft), driven by international firms including Vanguard (2024) and Starling Bank (2023).
The city is followed closely by Birmingham (133,587 sq. ft) and Edinburgh (121,400 sq ft). Business development, customer support, sales, IT, technology and HR roles are amongst the functions firms are moving out of London to these cities.
JLL’s data highlights a clear economic incentive for this migration, with operational costs in Manchester proving up to 30% lower than in the capital. This enables financial institutions to optimise expenditure and is directly translating into increased demand for regional office space.
Jonathan Wiedemann, Head of North West at JLL, said: “Much ink has been spilled chronicling the evolution of Manchester’s financial services sector, and this data only serves to underline the city’s impressive growth. From Castlefield to Ancoats, it’s a testament to the city’s growing reputation that so many world-leading firms are investing in bolstering their presence here.
“The recently published GM Strategy 2035 highlights the integral role that such investment can and will play in the city’s continued growth into a genuine alternative to London, and we look forward to working alongside these businesses to realise this ambition.”
James Devany, Director of Office Agency in the North West at JLL, said: “While London remains the premier location for front office staff, surging rents and changing ways of working mean that we’re seeing a growing number of firms consider how they can best deploy their back office staff across the country.
“Manchester offers a more affordable alternative, and its popularity amongst financial services firms will only grow as more set up shop here. Looking ahead, a key priority amongst the city’s real estate community must be to meet this demand with abundance of high-quality, client-centric office space.”
