Regional airport passenger growth drives office rents

Out-of-town office rents in the regions have grown strongly in areas that have seen significant increases in regional airport passenger numbers. Prime office rents in Liverpool grew the strongest with a 24% increase to £12.50 per sq ft during 2002-2004, according to King Sturge’s latest annual Airport Property Market Survey. The Nottingham/East Midlands and Newcastle regions – both with fast-growing airports – reported rental growth of 12% and 11% respectively. Passenger volume at Nottingham/East Midlands airports grew by 78% and Liverpool’s John Lennon airport increased numbers by 41% between 2001 and 2003. Southampton airport grew fastest in 2003 with passenger numbers increasing by over 54% to 1.2m. The figures contrast sharply with passenger numbers in London (City airport) and the Thames Valley (Heathrow) which grew by just 5% during the period. Only Stansted managed to buck the trend in London with passenger numbers growing by 16.6% to 18.7m. Out-of-town office rents in London and the Thames Valley also declined – by 14% and 5% respectively – during 2002-2004. Growth in out-of-town office rental levels and passenger volumes at a number of regional cities in the UK is expected to continue in 2005. References: EGi News 21/12/04