The momentum behind the upturn in office projects activity seen over the past year is set to continue into next year and beyond.
After an estimated 16% increase in the value of new office project starts this year, the new Glenigan Construction Industry Forecast 2026-27 predicts a further 13% increase in starts in 2026, followed by a more modest rise the following year.
Encouraged by the growing demand for high-quality, Grade A office space and employers’ need to get staff back into the workplace, work on both new and refurbishment projects is set to remain healthy. Meanwhile, the spread of data centres to meet growing demand for AI continues to fuel building activity in the office sector.
Although planning applications and main contract awards have eased recently, there remains a strong backlog of approved projects where work is set to get underway. In the third quarter of this year alone, Glenigan data shows office construction starts rose by 82% year-on-year.
The upturn comes amidst a partial recovery in construction work on new offices this year, rather than just refurbishments. Glenigan data shows that underlying (under £100 million) project starts on new office schemes are on course to reach around £2 billion this year, up from around £1,400 million in 2024.
A recent report from agent Knight Frank highlights various other promising trends in the office sector across major UK regional cities.
It notes that the take-up of office space by businesses in ten key regional business centres – Aberdeen, Edinburgh, Glasgow, Newcastle, Leeds, Manchester, Sheffield, Birmingham, Cardiff and Bristol – rose to 1.22 million sq ft in the third quarter of this year, up 19% on the previous three months. Strong demand was also being seen for smaller offices.
Seven out of the ten saw rents rise by up to 20% over the year as competition for new or recently completed Grade A space combined with limited new supply. The report also points to a ‘flight to quality’ in the sector, with new or recently refurbished space remaining scarce.
In London, major corporations are committing to large, premium office developments that show ‘long-term confidence in high-quality, future-proof workspace’, according to a separate report from BNP Paribas.
It points to a fall in the availability of central London office space at the end of the third quarter to 23.5 million sq ft, down 16.1%, from a year earlier. With over half of 2025 office development completions already pre-let, it says the supply of high-quality space is set to remain limited.
Together with the prospect of lower interest rates next year, all of these factors bode well for office construction activity.
Promising prospects
Glenigan data reflects the promising prospects for new work in the offices sector around the country.
In Bristol – where prime office rents have risen to £50 per sq ft, the highest outside London – detailed plans have been granted for a £22.3 million office scheme at Canningford House in Victoria Street for Boultbee Brooks Real Estate. Work on the scheme, which is at the pre-tender stage and involves almost 8,000 sq ft of space, is due to start early in the new year (Project ID: 22390154).
Moving north to Manchester, detailed plans have been granted, and tenders are being invited for Henry Boot Developments’ £140 million Colloco St John’s Office Scheme in the city’s New Quay Street. Work on the 16-storey office scheme is due to start early next summer and run for 15 months (Project ID: 25504200).
Meanwhile, in the City of London, plans have been approved, and tenders returned on a £200 million office building at Tenter House in Moorfields for the Freshwater Group (pictured). Work on the scheme involving almost 34,000 sq m of space is due to start later this year and run for 37 months (Project ID: 11151225).
