Not sure if this has been posted- apologys if it has- an article in propertyweek recently about Manchester
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Manchester
Developers in Manchester are increasingly excited by the idea of skyscrapers, seeing them as symbols of the city's growing status and achievement. "Manchester has international aspirations and is rapidly becoming an international quality city," says Merepark director Richard Peel. His company is one half of the joint venture Inacity, which has planning permission to build a 60-storey, £220m tower next to Piccadilly station, with 700 apartments anchored by a 220-bed hotel.
Yet although a range of exceptionally tall buildings is planned for the city, most are mixed use and dominated by residential units and hotels rather than offices - the latest is the 171 m Beetham Tower, (half Hilton hotel, half residential), which celebrated a topping out ceremony just last month. The only pure office tower with space available is Bruntwood's refurbishment of Piccadilly Plaza. It was recently renamed City Tower and is 28 storeys high.
Peter Crowther is sales and development director at Bruntwood. He says the construction costs measured against the returns possible for residential development mean it is unlikely that new towers will be built solely for office use in the city in the near future. "It just doesn't work at the moment in Manchester unless we were to see some significant rental growth or demand from an organisation for a pre-let."
Peter Gallagher, head of Dunlop Haywards' north-west operation, says the cost of refurbishment versus new build has made City Tower viable whereas a new build might not have been. He says that an issue with most towers is that of limited floorplates: "More and more of our enquiries now are saying they want their space to be on as few levels as possible. There is an immediate conflict with the idea of going into a tower because they tend to be high and slim."
City Tower's floorplates are 835 m² and Crowther confirms that lettings done since refurbishment began have been for up to two floors, rather than larger occupiers.
Meanwhile, plans for a 35-storey office tower at new business quarter Spinningfields are also progressing. Originally, developer Allied London wanted to build a Foster-designed sloping tower for 60,390 m2 of offices. This has now been redesigned without the slope and Allied London is contemplating changing it to a mixed-use building.
Graham Skinner, a director at Allied London, says the developer would be prepared to speculatively develop 50% of the tower but would need a pre-let to trigger the build. "We are working on a couple of schemes and we'll decide which one to put in for planning. We're looking at some other conceptions," he says.
The most dramatic feature on the city's skyline at the moment is the Beetham Organisation's 47-storey 301 Deansgate Tower. Hilton is to open a 279-bed hotel and all the tower's 219 apartments have been pre-sold. Beetham also has the option of building 6130 m2 of offices there but is now reviewing its options.
Even though his proposed tower, Albany Crown, is an £83m mixed-use development, Chris Nisbet, chairman of Albany Assets, has innovative plans for the 10-storey office element that he plans to wrap around the base of the tower. He says the traffic flow into offices means it is sensible to keep them at the lower levels. "If you have them high up, you need even more lifts and the more lifts you've got the less useable space you've got."
The office floorplates will be 1395 m2 in size and Nisbet intends to break two of the floors down into flexible grade A office space offering between 185 m2 and 465 m2. These will be available as "lease purchases", which tenants will have an option to buy at any time based on prices fixed at the start of the tenancy. Nisbet says not only will this help those who want to put their office into a self-invested personal pension, it offers an alternative exit strategy. "If you outgrow the office, then rather than paying to get out of the lease, you can buy the office, then put it on the market and sell it."
He believes this is an ideal opportunity for companies that want to move to Manchester and need grade A office space but want to test the water rather than commit for 15 or 25 years.
John Adams, a partner at Drivers Jonas, has worked on most of Manchester's tall buildings applications, including the Beetham Tower, Albany's Crown building and the Eastgate Inacity Tower. He says the council always looks for exceptional architectural quality, strong regeneration benefits and highly sustainable locations often at gateways to the city centre. "Beetham is a prime example of that; it establishes an iconic entry to the city centre on Deansgate," he says. "Manchester has a particular scale of urban grain and Victorian heritage and street pattern which lends itself well to tall buildings."
Adams says the Southern Gateway area of the city is likely to be a prime area for towers. "Any future tall buildings would not be in isolation but would be part of mixed-use developments."
Dave Roscoe is city centre group leader for planning at Manchester council. He says all modern tower developments in the city are mixed use. "We don't really have any modern office towers. There has been talk of one in Spinningfields but it has been all talk and no delivery. There are fairly obvious reasons for that in that no one is going to build [a tower] speculatively so you need a substantial end user. It doesn't mean it wouldn't work."
Inacity's Peel says there is no intention of adding offices to the 60-storey tower at Piccadilly. "There will be office developments in the area and fundamentally the hotel is there to service them. However, we won't rule out looking at other schemes in that area for offices."
Summing up
Although Manchester is likely to see many more tall buildings, those looking for office space at the top of towers will have a hard time finding it once Bruntwood lets its space. The financial viability of residential and mixed-use towers has so far held developers back from building pure office skyscrapers. There are plenty of office buildings being developed up to 20 storeys that would, in any other city, be considered tall. In Manchester, the scale is different.