Following the promising shoots of recovery observed in Deloitte's last Crane Survey, its 2016 report has demonstrated the city region's investment appeal with a return to pre-recession construction levels.

In particular, this year's results show the formation of new, viable neighbourhoods throughout Manchester, with more homes, bars and restaurants enlivening the city centre following the post-recession slowdown. Residential construction figures have returned to the highest level since before 2008, and are almost double those reported last year, with 2,982 units currently underway.

It is also important to note that funding from The Greater Manchester Housing Fund, which will offer £300m over the next ten years, has helped to assist in the completion of 744 units within the study areas since its inception.

Retail, Hospitality and Leisure

The residential figures are complemented by the resurgence in retail, hotel and leisure development, led by the completion of two major leisure destinations within the city centre: the refurbished Corn Exchange (131,200 sq ft of A1 and A3 space), and cultural facility HOME, which brought 500,000 sq ft of mixed leisure and retail space to the city centre.

The hotel sector enjoyed a spike in completions, with 648 new rooms in the survey, representing the opening of four different hotels at different ends of the market (Motel One, 330 rooms; Melia, 208 rooms; Hotel Gotham, 60 rooms; King Street Townhouse, 40 rooms).

Offices

While the growth figures attest to the continued investment in the city centre, the commercial sector has seen an absence of any Grade A space completed for the first time in 14 years.

However, with the current volume of office space at 1.04 million sq ft (the highest since 2008) and the current construction levels expected to deliver around 520,000 sq ft. in 2016 and 2017, the lull is more reflective of post-recession pipeline activity and should still be considered promising for the coming years.

Five major schemes are driving a high level of construction: No. 2 St Peter's Square (161,113 sq. ft.); One Spinningfields (362,607 sq. ft.); XYZ (160,000 sq. ft.); 101 Embankment (165,000 sq. ft.)
and One New Bailey (125,000 sq. ft.). The demand for space has meant that 78.4% of the space to be delivered in 2016 is currently pre-let.

Education and Research

Education-related developments have followed a period of high movement (an average of 252,767 sq ft completed over the previous 3 years) with comparatively low development levels. The one completion was the National Graphene Institute in March, which marks the first in a number of facilities for researching the wonder materials, with the Graphene Engineering Innovation Centre expected to commence in 2016.

With regard to student accommodation, there are no further significant student housing initiatives under construction for completion in 2016 or 2017 in the city centre. This does not equate to stagnation in the sector, with a number of schemes that have not yet broken ground, including the redevelopment of Owens Park.

Notable Transactions

What next?

Manchester's recent success, both politically and commercially, highlights the city's credentials as a devolution exemplar for the rest of the North of England. Given the political backing of the Northern Powerhouse Agenda, it will be important to examine how the city continues to adapt to this changing political landscape of devolved power.

While the devolved spending powers are yet to be implemented, the fact that Greater Manchester was the first region to strike a deal with government clearly highlights its strength as a unified authority. This strength is reflected in this year's key statistics.

Download the report- Manchester Crane Survey 2016 | Construction activity boost

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