[UPDATE] MediaCityUK in Greater Manchester beckons investors with attractive yields
By Cecilia Chow
/ EdgeProp Singapore |
Located on the banks of the Manchester Ship Canal at Salford Quays in Greater Manchester, MediaCity is home to British media giants BBC and ITV (Source: MediaCityUK website)
SINGAPORE (EDGEPROP) - On the site of the former Manchester Docks is MediaCityUK, a 37-acre (15ha) site that is now a hub for creative, tech and media industries. Located on the banks of the Manchester Ship Canal at Salford Quays in Greater Manchester, MediaCityUK is home to British media giants BBC and ITV, television facility owner and services company Dock10, British e-commerce retailer The Hut Group, Swedish telecoms group Ericsson and American cereal giant Kellogg’s.
MediaCityUK is the biggest tech and media hub outside of London, with over 250 creative and tech businesses as well as schools and universities. There are already 8,000 residents and workers at MediaCityUK. Phase One, which was completed and officially opened in 2012, is a 1.4 million sq ft, mixed-use development across 11 buildings with work spaces, studios, incubator labs, residences as well as ancillary leisure and retail facilities.
Phase Two has already seen the completion of two residential towers — The Green Rooms, with 238 rental apartments; and The Lightbox, with another 238 apartments. The award-winning Tomorrow building, with six floors of flexible workspace and the 112-bedroom Premier Inn on the upper floors, is also completed. Outline planning consent has been obtained for an additional 1.6 million sq ft of built-up space, including offices and residences. The estimated gross development value of the development is GBP750 million ($1.25 billion), bringing the total space in Phase Two to 2.3 million sq ft.
Artist’s impression of the two residential towers of the upcoming 280-unit High Definition, with the taller 16-storey Aalto and 13-storey Aria (Picture: JLL)
Last November, Land Securities Group (Landsec) announced that it has acquired a majority 75% stake in MediaCityUK for GBP425.6 million. MediaCityUK was developed by Peel L&P (Peel) and Legal & General (L&G) in a 50:50 joint venture. Landsec has purchased L&G’s share plus 50% of Peel’s share, totalling 75% of the joint venture. The remaining 25% will be retained by Peel, which will continue to serve as asset and development manager of MediaCityUK.
High Definition
The latest residential development launched at MediaCityUK is High Definition by developer Latimer, with two blocks on the waterfront — the 16-storey Alto and 13-storey Aria — linked by a podium with landscaped roof terrace. The 280 apartments feature open-plan living and kitchen spaces, floor-to-ceiling windows and high-specification, contemporary finishing. Scheduled for completion in November 2022, the apartments are a mix of one-, two- and three-bedders, which are offered for outright sale and with shared ownership.
Alto, the first residential block at High Definition was launched for sale in March this year. Of 155 apartments, 40 have already been sold. The building has proven to be popular amongst private owners, investors and also those using the government backed Help to Buy scheme, says JLL. The second block, Aria, will be launched later this year and will offer buyers the opportunity to purchase using the Shared Ownership scheme (open to UK citizens only).
Artist’s impression of the living room of one of the apartments at High Definition, which has a mix of one- to three-bedders (Picture: JLL)
JLL, the appointed marketing agency for High Definition, is planning to launch the project in Singapore sometime in 3Q2022. One-bedroom apartments are priced from GBP193,000 to GBP215,000; two-bedders from GBP297,500 to GBP345,000; and three-bedders at GBP430,000.
According to a JLL rental guide, one-bedroom apartments can expect to achieve a monthly rental rate of GBP950 to GBP1,100, which translates to gross rental yield of 5.9% to 6.1%. Owners of two-bedders can expect monthly rental rates of GBP1,100 to GBP1,400, or gross yields of 4.4% to 4.9%; and for three-bedders, rental rates are estimated to be in the range of GBP1,650 to GBP1,800 per month, or gross yields of 4.6% to 5%.
Residents’ amenities include Club HD, a club exclusive to residents, with access to a range of services and amenities including co-working spaces, meeting pods and long tables for collaborative work and socialising. There is also a Club HD terrace lounge located on the first floor.
Artist’s impression of the open-plan kitchen within an apartment at High Definition (Picture: JLL)
“High Definition is a high-quality product with excellent on-site amenities, which will be attractive to tenants,” says Chua Shir Yee, JLL head of sales, international residential, Singapore. “This ensures high demand and limited voids.”
Chua foresees the development attracting a professional tenant profile, given its location in the heart of MediaCityUK, proximity to bars, shops and restaurants. It is just a minute’s walk to the Media City Tram Station, a 20-minute tram ride to Manchester City Centre and a 30-minute ride to the Etihad Campus, home of the Manchester City Football Club. The Old Trafford football stadium, home of the Manchester United Football Club, is just a 10-minute walk from MediaCityUK, she adds.
Rising prices, rents
Properties in Manchester let so far this year have achieved average rents of GBP1,207 psf, which is a 21% increase from 1H2022. “The Manchester rental market is seeing an influx of new tenants looking for homes in the city,” says Chua. Application registrations increased by 23.5% in 2H2022, compared to 1H2022.
Source: JLL
According to the JLL Cities Index, Manchester housing rents have increased 58% in the last 10 years. Meanwhile, housing prices in Manchester increased by 233% over the past 20 years, surpassing the 198% recorded in London over the same period, according to Land Registry data collated by JLL.
Recent fears of an oversupply in the new housing sector in Manchester City Centre had prompted some developers to pause their activity. Consequently, there is now a shortfall in the supply pipeline to meet anticipated demand, says JLL in a July presentation.
Source: JLL
The number of applicants looking for homes in Manchester has risen 49% in 2022, compared with the same period last year, with demand back to pre-pandemic levels, says JLL. On a quarterly basis, the number of applications increased 57% from 1Q2022 to 2Q2022. Meanwhile, average sale price in Manchester is up 9.5% q-o-q in 2Q2022, according to JLL data.
The JLL Cities Index shows gross yields on new homes in Manchester averaging 5.4%. “New homes in Manchester offer an attractive yield for investors,” says Chua.
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