Developer looking to build new city centre office block as strong take-up leaves space at all-time low

September 15, 2023

Another Bristol office scheme is nearing full occupancy as the city centre market continues to strengthen, triggering its developer to unveil plans for a new building on a neighbouring site.

Royal London said the next phase of its Distillery scheme on Avon Street would bring an additional 130,000-plus sq ft to the market.

The building, which does not yet have planning consent, would be the third phase of The Distillery scheme.

The first two phases of the 92,000 sq ft scheme have signed occupiers for 21,000 sq ft so far this year, Royal London said this week, taking the scheme’s overall occupancy to 90% let or under offer.

Among the recent deals at The Distillery are PA Consulting Group, SNC Mission UK, Ramboll and Armadillo CRM. 

These four will contribute to the diversified tenant mix at The Distillery, which includes Canada Life, Pax8, IOPP and Clyde & Co, Royal London said.

Property agents say the moves demonstrate the strong demand for high-quality, sustainable office space in the city centre. As a result, available space is currently at an all-time low of around 4% due to shortage of new schemes coming onto the market.

The success of The Distillery has prompted Royal London Asset Management, the development’s owner, to move forward with plans to submit proposals for the construction of 3 The Distillery.

Hannah Waterhouse, pictured, director – office agency at JLL, which is marketing The Distillery, said the new development would be crucial to meet the growing demand.

“We are excited to see the continued success of The Distillery as it attracts more high-calibre tenants,” she added. 

“The strong demand we have experienced reaffirms the need for sustainable and well-designed office spaces in Bristol.” 

Royal London asset manager Arabella Pollock said: “These recent lettings at The Distillery are testament to its exemplary design and best-in-class environmental credentials.”

Two weeks ago national wealth management and professional services group Evelyn Partners announced it is to relocate its Bristol office to the EQ building on Victoria Street.

That means the shortly-to-open 200,000 sq ft development – Bristol’s first new office scheme to target operating with net zero carbon – is now 65% pre-let.

The Distillery and EQ are among a number of major office schemes around the city centre to benefit from a post-pandemic ‘flight to quality’ as firms look for modern, flexible space to tempt employees into the office while also boosting their own ESG (environmental, social and governance) credentials.

Other flagship city centre offices schemes, such as Cubex’s Halo at Finzels Reach, Nord’s 1 Portwall Square on Redcliffe Way and AXA/Bell Hammer’s Assembly on Temple Way, also secured lettings before being completed. 

Knight Frank acted alongside JLL on The Distillery lettings.

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