Manchester Monitor June 2013
Greater Manchester office market largest outside London
Jobseeker Numbers Fall Again Office Take-up Highest Outside London Hotel Occupancy on the Rise Again House Prices Continue to Slide Further Decline in Crime Volumes www.neweconomymanchester.com research@neweconomymanchester.com
Monitor Focus Greater Manchester office market largest outside London In the latest assessment of the property market, DTZ
The latest data from the Land Registry show that the average
expects annual take-up of office space in Manchester city
house in GM cost £101,035 in April 2013, a decline of 3.5%
centre to be in the region of 850,000 sq. ft, making it the
(-£3,640) from this time last year. House prices in GM have
largest commercial property market outside London. The
now been declining on an annual basis since December
role played by business & professional services in Greater
2010, 29 consecutive months.
Manchester (GM) is key in this respect, and on a recent trip to the conurbation, Sir Mervyn King stated that GM has an exciting future thanks to its successful nurturing of growth sectors.
Crime volumes are continuing to fall and there were around 183,000 reported crimes in GM in the 12 months to April 2013 – an annual decline of 10.6%, or almost 22,000 fewer offences. Victim-based crime saw nearly 161,000 cases
The commercial property market has also seen a £250
recorded over the same period, representing a year-on-year
million warehouse scheme revealed for the Cutacre strategic
fall of 9.5% (-16,940). The latest crime figures also show that
site, which spans Bolton, Wigan and Salford. A planning
for the 12 months ending April 2013, GM Police successfully
application for the scheme, branded as Logistics North, is
solved 30% of all crimes, albeit slightly down (0.9
due to be submitted in the coming weeks. It will provide a
percentage points) compared to the previous 12 months.
range of warehouse units up to 1 million sq. ft, and will also be targeted towards manufacturers and office users. Initial estimates by New Economy suggest that once complete and fully let, Cutacre as a whole has the potential to create in excess of 5,000 net new jobs in GM.
The visitor economy continues to perform well, and the latest hotel data show that occupancy levels in both the city centre and GM as a whole in April 2013 were 75% – increases of 3 and 4 percentage points respectively. In addition, Manchester Airport is continuing to see year-on-year growth
Positively, unemployment has declined and the latest figures
in passenger numbers – outpacing that seen at any other
show that 84,000 people were claiming Jobseeker’s
major UK airport. It handled 1.45 million passengers in
Allowance (JSA) in GM in April 2013 – a decrease of just over
March 2013, an annual increase of 6.0% (81,800 additional
1,500 (-1.8%) compared with the figure for March 2013 of
passengers). The Airport recently welcomed its 20 millionth
85,500. Youth unemployment (JSA claimants aged 16–24)
passenger of the year, the first time it has achieved this in
in GM also declined on a monthly basis, falling by
four years.
approximately 1,000 to around 22,300 between March and April. Despite long-term claimants (6 months +) rising slightly to 38,500 (+600) over the same period, a lot of the underlying data this month paint a more positive picture of the current economic climate. While the economy still clearly faces a number of challenges, the most recent quarterly inflation report by the Bank of England upgraded forecasts for the second quarter of 2013, with the UK economy now expected to grow by 0.5%. Total growth over the year is forecast to be around 1.2%, up from the 1% estimate made in February.
1 | Manchester Monitor – June 2013
Monitor Statistics Business Monitor
Indicator
This Period
Last Period
Last Year
Period Change
Annual Change
Office take-up in Manchester
245,369 sq. ft
297,311 sq. ft
169,891 sq. ft
-17.5%
44.4%
Office supply in Manchester
2.7m sq. ft
2.9m sq. ft
3.2m sq. ft
-6.3%
-14.3%
Prime office rents in Manchester
£30/sq. ft
£30/sq. ft
£30/sq. ft
83,960
85,466
85,810
-1.8%
-2.2%
Male
56,351
57,584
59,538
-2.1%
-5.4%
Female
27,609
27,882
26,272
-1.0%
5.1%
Youth Claimants (Aged 16-24)
22,260
23,220
26,170
-4.1%
-14.9%
Long-Term Claimants (6 Months+)
38,525
37,910
38,395
1.6%
0.3%
£101,035
£101,759
£104,675
-0.7%
-3.5%
1,742
1,616
1,788
7.8%
-2.6%
1,453,168
1,196,257
1,371,359
21.5%
6.0%
Flights
11,906
10,439
12,407
14.1%
-3.4%
Hotel Occupancy (city centre)
75.4%
76.5%
72.9%
-1.1% pts
2.5% pts
Hotel Occupancy (GM)
74.7%
75.2%
70.6%
-0.5% pts
4.1% pts
Total Crime Volume
182,636
-
204,361
-
-10.6%
Victim-Based Crime Volume
161,001
-
177,941
-
-9.5%
Total Crime Solved Rate
30.1%
-
31.0%
-
-0.9% pts
Victim-Based Crime Solved Rate
24.3%
-
24.4%
-
-0.1% pt
Total Deliberate Fires
8,594
-
9,443
-
-9.0%
Housing Monitor
People Monitor
JSA Claimants
Average House Price
Number Of Sales
Crime Monitor
Place Monitor
Manchester Airport Passengers
Positive change
Negative change
No change
IMPORTANT NOTE: The source of the hotel occupancy data referenced in this newsletter is STR Global Ltd. Republication or other reuse of this data without the express written permission of STR Global is strictly prohibited.
Manchester Monitor – June 2013 | 2
People Monitor Jobseekers continue to decline The latest figures show that 84,000 people were claiming Jobseeker’s Allowance (JSA) in GM in April 2013 – a decrease of just over 1,500 (-1.8%) when compared with the figure for March 2013 of 85,500. The North West (-2.6%) and Great Britain (-2.9%) also saw monthly declines. As a proportion of the resident working age population, 4.8% of people in GM were claiming JSA in April, which remains above the North West (4.2%) and Great Britain (3.7%) rates.
The number of male JSA claimants fell on a monthly basis
Despite the ILO’s pessimism, much of the recent underlying
by 2.1% (1,233) to 56,400, while the number of female
data at a UK level is beginning to give some credence to the
claimants also fell by 1.0% (273). There was a year-on-year
possibility that the economy has turned a corner. The most
fall in male JSA claimants in GM of around 3,200 (5.4%),
recent quarterly inflation report by the Bank of England
though the number of female claimants remains 5.1%
upgraded forecasts for the second quarter of 2013, with the
(1,300) higher than this time last year.
UK economy now expected to grow by 0.5%. Total growth over the year is forecast to be around 1.2%, up from the 1%
Youth unemployment (JSA claimants aged 16–24) in GM declined on a monthly basis between March and April, falling
estimate made in February, though OECD forecasts remain more cautious.
by approximately 1,000 to around 22,300. Year-on-year, the number of youth JSA claimants is now 14.9% (3,900) less than this time last year.
For GM, it will be more important than ever to capitalise on areas that have grown or have potential to grow, such as the media and professional services sectors, a point highlighted
The number of long-term claimants (those claiming JSA for 6 months or longer) in GM continued to rise in April 2013 to 38,500, a monthly increase of 600 (1.6%). On an annual basis the number of long-term claimants remains marginally higher (0.3% or 130 claimants) than this time last year. By contrast, however, the North West (-2.1%) and Great Britain
by the outgoing governor of the Bank of England, Sir Mervyn King, on a recent trip to the area. Initiatives such as the newly announced Manchester University Recruitment Service for Business, which links graduates with local employers, will also be important in ensuring that new employment opportunities continue to be created in the conurbation.
(-3.2%) have seen annual declines in long-term claimants.
Total Jobseeker’s Allowance Claimants in April 2013
Looking ahead, all of the indicators, including recent analysis on youth unemployment by the International Labour continuing to be extremely challenging over the coming
83,960
months. The ILO has warned that the global youth
Decreased by 2.2% year-on-year
Organisation (ILO), point to the employment market
unemployment rate continues to rise and is projected to reach 12.8% by 2018 – effectively wiping out any gains made at the start of the economic recovery.
Jobseeker’s Allowance - Annual Change
h5.1%
Women
3 | Manchester Monitor – June 2013
$5.4% $14.9% h0.3%
Men
Youth
Long-term
Business Monitor Office Take-Up and Availability in Manchester (sq. ft) 4,000,000
800,000
Take-Up
3,500,000
700,000
3,000,000
600,000
2,500,000
500,000
2,000,000
400,000
1,500,000
300,000
1,000,000
200,000
500,000
100,000
Q 113
Q 412
Q 312
Q 212
Q 112
Q 411
Q 311
Q 211
Q 111
Q 410
Q 310
Q 210
0
Q 110
0
Take Up (sq. ft)
Availability (sq. ft)
Availability
Office take-up highest outside capital In its latest assessment of the property market, DTZ highlights that office take-up in Manchester city centre fell in the first quarter of 2013, while headline prime rents remained unchanged. The new data analysis also serves to emphasise the fact that Manchester remains the largest office market outside London in terms of take-up, which is expected to be in the region of 850,000 sq. ft in 2013 – up from 790,000 sq. ft in 2012. Overall take-up in the city centre fell slightly in Q1 2013 after
Thereafter availability is forecast to fall, with sharper falls in
a strong finish to the year in Q4 2012 – falling from 297,000
grade A availability this year. The current prime rent for office
sq. ft to 245,000 sq. ft. More positively however, Q1 2013
space in Manchester is £30 per sq. ft, having remained
take-up was higher than the corresponding figures for the
unchanged since Q4 2011.
first quarters of 2010 (185,000 sq. ft), 2011 (135,000 sq. ft) and 2012 (170,000 sq. ft).
A £250 million warehouse scheme has recently been revealed for the Cutacre site, which spans Bolton, Wigan
Availability fell in Q1 2013 to 2.7 million sq. ft. At the same time
and Salford. A planning application for the scheme, branded
in 2012 the amount of office space available in Manchester
as Logistics North, is due to be submitted in the coming
stood at 3.2 million sq. ft. The office market remains polarised
weeks. It will provide a range of warehouse units up to 1
according to DTZ, with 3.6 years of grade B supply at current
million sq. ft, and will also be targeted towards
take-up rates, but only 1.5 years of grade A.
manufacturers and office users.
City centre availability is forecast to peak in 2013 when the Co-op markets a number of former sites following its move to One Angel Square, which is part of the wider £800 million NOMA scheme.
Manchester Monitor – June 2013 | 4
Place Monitor Hotel occupancy on the rise again Hotel data show that occupancy levels in the city centre and GM in April 2013 both increased on an annual basis. Adding to the good news, Manchester Airport is still continuing to see year-on-year growth in passenger numbers – outpacing that seen at any other major UK airport. Hotel Occupancy
Airport Passenger Numbers
Hotel occupancy rates in Manchester city centre were
Manchester Airport handled 1.45 million passengers in
recorded at 75% in April 2013, a rise of 3 percentage points
March 2013, compared to 1.37 million 12 months previously,
on the same month last year. Weekend occupancy in the
an increase of 6.0% (81,800 additional passengers). The role
city centre averaged 84% during the month, down slightly
played by the 14 new destinations, including Washington DC
on the April 2012 figure of 85%. The weekday average
and Moscow, that were added to the route network during
occupancy in the city centre was 73% – the first time it had
that time is likely to have been one of the main contributing
surpassed 70% in the month of April since 2008.
factors behind the rise.
For GM as a whole, average occupancy rates in April were
The upward trend at Manchester is stronger than the London
the same as the city centre at 75%, a rise of 4 percentage
airports, with Heathrow, Stansted (which was recently
points compared to the previous twelve months.
acquired by Manchester Airport Group) and Gatwick seeing passenger numbers grow by 3.9%, 3.8%, and 2.5%
Key dates for hotel occupancy in the city centre during April were:
respectively between March 2012 and 2013. By contrast, Birmingham Airport actually saw annual passenger numbers
• 8 April – occupancy of 98% was achieved for the Manchester derby in the Premier League.
fall by 0.9% over the same period. With new routes to Russia, Egypt and Greece scheduled to
• 22 April – 98% occupancy was also recorded when
be added during the summer, all signs suggest that growth
Manchester United played Aston Villa in the Premier
is set to continue at Manchester Airport. Passenger numbers
League and Michael Ball performed at the Bridgewater
in the first quarter of 2013 were 136,000 higher than the
Hall.
same period in 2012, and the Airport recently welcomed its 20 millionth passenger of the year - the first time it has
• 27 April – 93% occupancy, coinciding with Manchester
achieved this in four years.
City and Wigan Athletic both having home league games, as well as X Factor auditions at Old Trafford. Airport passenger numbers
(+6.0%)
Hotel occupancy (city centre)
1,453,168
75%
Flights
Hotel occupancy (GM)
(-3.4%)
11,906 % represents year-on-year change
IMPORTANT NOTE: The source of the hotel occupancy data referenced in this newsletter is STR Global Ltd. Republication or other reuse of this data without the express written permission of STR Global is strictly prohibited
5 | Manchester Monitor – June 2013
75%
(+3.0%points)
(+4.0%points)
Housing Monitor Year-on-year change in house prices 20% 15% 10% 5% 0% -5% -10% -15%
Greater Manchester
London
England & Wales
3
12
Ap r1
Au g
De c
12
2 Ap r1
11 De c
11 Au g
1 Ap r1
10 De c
10 Au g
0 Ap r1
09 De c
09 Au g
Ap r0
9
-20%
GM house prices continue to slide The latest data from the Land Registry show that the average house in GM cost £101,035 in April 2013, a decline of 3.5% (-£3,640) from this time last year. England & Wales saw a small annual rise in house prices, while London continues to see the strongest annual growth. House Prices
Mortgage and Landlord Possessions
Property prices in England & Wales grew marginally between
Ministry of Justice (MoJ) data show that there were 945
April 2012 and 2013 – rising by 0.7% (£1,085), and now
mortgage possession claims in GM in Q1 2013. This was
stand at £161,458. While this is still well below the national
11.3% less than the 1,065 claims issued in the same quarter
peak average of £182,000 in February 2008, prices in
in 2012. At a national level there has also been a fall in the
England & Wales have now increased year-on-year for 12
number of claims since 2008, which the MoJ notes has
consecutive months. In contrast, prices in GM have been
coincided with lower interest rates and a more proactive
declining on an annual basis since December 2010 – 29
approach from lenders in managing consumers in financial
consecutive months.
difficulties.
London is still setting the pace in terms of house price rises,
In Q1 2013, 770 mortgage possession claims led to orders
reaching nearly £376,000 in April 2013 – an annual increase
in GM. This was down by 20.6% (-200) on Q1 2012 and
of 6.2% (+£22,081). The last time it saw prices fall on a yearly
similar to the declines seen at regional (-21.4%) and national
basis was in September 2009.
(-20.2%) levels.
Land Registry house sales data reveal that there were just
In GM there were 2,460 landlord possession claims against
under 1,750 properties sold in February 2013, virtually in line
tenants (for rent arrears, for example) against tenants in Q1
with 12 months previously, reflecting the continued
2013, up by 4.5% (105) annually, while 1,818 landlord claims
stagnation of the market.
led to orders for possession in the conurbation in Q1 2013 – a yearly rise of 18.1% (+278).
Manchester Monitor – June 2013 | 6
Crime Monitor Crime Volumes in Greater Manchester
Year to April 2012
177,941
Year to April 2013
26,420
161,001
0
50,000
Victim based crime
Total Crimes 182,636
21,635
100,000
150,000
Total Crimes 204,361
200,000
250,000
Non-victim based crime, fraud & forgery
Crime volumes continue to decline Data released by GM Police (GMP) for the year ending April 2013 show that the number of reported crimes is continuing to fall, declining by almost 11% over the last 12 months. The new data also reveal that 30% of all crimes were solved in GM over the past year, albeit nearly 1 percentage point lower than April 2012. Crime Volumes
In terms of victim-based crime (violence, sexual offences,
Figures for the year ending April 2013 show that there were
criminal damage & arson and stealing), 24.3% of cases were
around 183,000 reported crimes in GM – an annual decline
solved over the 12 months to April 2013, a marginal year-
of 10.6%, almost 22,000 fewer offences.
on-year fall of 0.1 percentage points.
Victim-based crime saw nearly 161,000 cases recorded over
GM Fire & Rescue Service Data
the same period, representing a year-on-year fall of 9.5%
Deliberate fires in GM were recorded at 8,594 for the 12
(-16,940). Criminal damage and arson saw the biggest year-
months to April 2013, compared to a figure of 9,443 for the
on-year fall of all victim-based crimes, with 29,000 offences
previous year, an annual decline of 9% (849).
for the 12 months to April 2013, down by 15.9% (-5,224) on the 2012 figure.
Primary fires, those where owned property is involved, were recorded at 1,684 for the year ending April 2013, a year-on-
Crimes Solved GMP successfully solved 30% of all crimes for the year ending April 2013 – a slight decline of 0.9 percentage points compared to the previous 12 months.
7 | Manchester Monitor – June 2013
year fall of 24.2% (-539).