Jones Lang LaSalle’s report on the Leeds Office Update for the second quarter of 2009 indicates the market has been stagnant, with most deals pertaining to renewals of the current office space. Most of the notable deals have been from churn, with none of the new deals exceeding 10,000 square feet.

According to the report, desk space take up stayed in line with the last five years’ trends, with a slight dip this year. The current economic slowdown seems to have forced occupiers to retain existing office space. Landlords seeking to retain income streams are being forced to negotiate on existing terms with their tenants. The latter are in turn keen to avoid the additional cost of relocation to new premises. The development of new commercial space throughout the area has stagnated as a result, with few takers for most of the new developments around the city.

According to the Jones Lang LaSalle report, the enquiries for new office space were a major letdown this year, with total enquiries only around 128,500 square feet. This is a drop of over 40% over the previous 5 years’ average.

The market for the rest of the year is likely to remain at the same stagnant level. The only demand drivers for office space seem to be the public offices, which already constitute a major chunk of the existing occupiers in the Leeds city area. The total demand for new office space at the end of 2009 is estimated to be around 350,000 square feet.