Palace Capital’s Sinclair: Occupiers are waking up to new office needs
The chief executive of Palace Capital has said office occupiers have finally woken up to the need to rethink their office strategies after months of pandemic-induced inertia during months of homeworking.
“Companies have kicked the can down the road on their office space and are waking up and thinking, ‘if I don’t do something, I might miss it’,” said Neil Sinclair, noting that the REIT has seen a notable rise in enquiries for space in its offices.
Sinclair spoke as Palace posted results that showed it returning to an interim profit, thanks to ongoing disposals and a string of sales at its Hudsons Quarter development in York.
The chief executive of Palace Capital has said office occupiers have finally woken up to the need to rethink their office strategies after months of pandemic-induced inertia during months of homeworking.
“Companies have kicked the can down the road on their office space and are waking up and thinking, ‘if I don’t do something, I might miss it’,” said Neil Sinclair, noting that the REIT has seen a notable rise in enquiries for space in its offices.
Sinclair spoke as Palace posted results that showed it returning to an interim profit, thanks to ongoing disposals and a string of sales at its Hudsons Quarter development in York.
Sinclair and the team are now keen to buy – competition for the right assets is tough, the chief executive said, but his belief in the strength of the regional office market is unwavering.
He highlights Leeds as a destination of choice. If the government’s upcoming integrated rail review disappoints the city as rumoured (£), Sinclair said, talk of a new tram system could soften the blow.
“If you look at the regional cities, the Manchester tram system is fantastic,” he added. “Edinburgh is the same and Nottingham is the same. But Leeds is desperate for a tram system. Leeds is an exciting city. The Bank of England have said they want to relocate a lot of people to Leeds. They’ve already picked up the Infrastructure Bank. They’re getting the deals.”
Activity is picking up in York, he added – and in Newcastle, where speculative office development is on the rise and requirements are piling up. And then there’s Liverpool. “I love Liverpool,” Sinclair said. “There are things happening in Liverpool that maybe people don’t see, but my son, who lives in America, said ‘dad, don’t ignore the Premier League. You’ve got to understand that everyone here knows where Manchester is and everyone knows where Liverpool is’. You just get that feeling in the city. There’s a buzz.”
In Liverpool and elsewhere, Sinclair and his colleagues are now confident that a buzz is turning into something more substantial – namely lettings and tenants getting their feet back under the desk. Demand has bounced back from the depths of the Covid-19 crisis, Sinclair said, and he hopes the REIT continues to benefit from it.
“Last week, we had two companies looking at the same space and both want it,” he said. “That hasn’t happened for two years.”
To send feedback, e-mail tim.burke@eg.co.uk or tweet @_tim_burke or @EGPropertyNews
