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News Release


Cardiff’s office market sees significant boost in investment

New JLL report shows that investment volumes for H1 2015 almost reached the total figure for whole of last year

Cardiff, September 18 2015 – A new report by leading property consultancy JLL shows that the level of investment in Cardiff’s office market reached £56 million in the first half of 2015, almost as much as the figure recorded for the whole of 2014.

Justin Millett, Director who heads the investment team at JLL in Cardiff, said that 2015 volumes will far exceed last year, with investors looking to the Welsh Capital for value for money as property markets in other leading regional cities, the south east and London become overheated.

The volume of investment in Cardiff’s offices sector in 2014 reached £60 million, according to JLL’s research report.

Mr Millett said: “Cardiff’s investment market was relatively subdued in the first quarter of the year due to a lack of stock, but that imbalance between supply and demand is being addressed with new properties coming to the market.”

“There continues to be strong demand for investment product in Cardiff with the city centre market transacting £42.1 million during the second quarter; the key sale being Helmont House to the Lancashire Pension Fund for £34.6 million.”

Other deals that have recently completed in Cardiff include the sale of Greyfriars House to overseas investors for £6.55 million and the sale of Eastgate House and Knox Court, occupied by Legal & General, to Maya Capital for £7.5 million and £6.75 million respectively.

Mr Millett added: “We have seen the improved liquidity of secondary office stock, meaning that those assets that were difficult to trade a couple of years ago are now in demand and prices are rising.”

“The sale of some super-prime assets in Cardiff, due to complete during the remainder of 2015, will further boost the annual investment volume. These include the sale of Admiral’s HQ in Cardiff as part of the multi-property, European portfolio to Amundi Immobilier, which was advised by JLL, together with Legal & General’s investment into Rightacres’ and Cardiff Council’s Central Square masterplan.”

According to the report, prime headline rents in Cardiff remained static year-on-year but JLL predicts these will rise by the end of the year.

Rhydian Morris, head of office agency in JLL Cardiff commented: “The office lettings market saw a quiet start to 2015, however activity levels doubled in the second quarter, with the media, finance and professional services sectors dominating activity”.

Mr Morris added: “Cardiff has a good growth story to tell, combined with a strong educational base, meaning that it is attractive from an employer’s perspective, thus boosting interest from occupiers.” 

A shortage of Grade A space, continues in Cardiff and is being addressed by three key development schemes totalling 260,000 sq ft, however the concern is that the current demand may exceed both the existing and under-construction supply.