_How UK regional cities are powering the nation

We explore the distinct characteristics that make Cardiff, Leeds, Manchester, and Sheffield attractive investment hubs in the UK. From Cardiff’s cultural appeal and capital-city status to Leeds' focus on student retention, Manchester's economic strengths, and Sheffield's leadership in manufacturing and green energy, each city offers unique advantages and growth potential for real estate investment.

Cardiff

Written by Matt Phillips, Partner and Office Head in Wales.

Cardiff: capital city culture driving tourism and investment in Wales

The cultural richness and capital city status of Cardiff play a crucial role in driving tourism and demand for commercial real estate in the area, making it an attractive investment destination. Cardiff's status as the capital of Wales, enhanced by devolution, has shifted businesses’ perspectives. Increasingly, companies recognise the need for a Cardiff address, signalling the city's growing importance compared to nearby competitors like Bristol.

Cardiff's appeal is strongly rooted in its cultural assets. The city is home to the Wales Millennium Centre, three universities, and the iconic Principality Stadium, which hosts major rugby, football, and concert events. This cultural vibrancy, combined with its thriving sports scene, including Glamorgan Cricket and Cardiff City FC, significantly boosts the city's profile beyond what its relatively small population of around 400,000 might suggest.

For investors, Cardiff presents opportunities in mixed-use developments, catering to both tourists and locals. With its high quality of life and proximity to natural attractions like the Brecon Beacons and the coast, as well as its convenient rail link to London (just 1 hour and 40 minutes away), Cardiff is attractive to both students and professionals, many of whom choose to stay in the city post-graduation. The city’s strong cultural identity not only draws visitors but also supports a sense of local pride, indirectly driving demand for commercial spaces in retail, hospitality, and office sectors.

Cardiff's unique blend of cultural richness, capital city stature, and high quality of life creates steady demand for mixed-use and commercial developments, making it a promising location for investment in the UK's regional cities.

Leeds

Written by Graham Foxton, Partner, Capital Markets.

Population growth in Leeds: a catalyst for future development

The population of Leeds is growing significantly, particularly in areas that align with the city's core identity and long-term vision. This growth is driving positive changes for future generations. One of the key sectors contributing to this transformation is the Purpose-Built Student Accommodation (PBSA) market, which has seen a sustained period of development. This expansion is attracting high-quality talent to the city, as evidenced by the rising enrolment figures across universities in Leeds. However, while attracting talent is important, the real challenge lies in retaining it.

Leeds has historically fallen short when compared to other regional cities and London, particularly in terms of city-centre amenities and vibrant living spaces—key factors that younger generations now prioritise. Today’s students no longer settle for the outdated multiple occupancy housing model; instead, they expect modern, high-quality PBSA. This preference is something they carry forward into their professional lives, seeking similar standards when they transition into the workforce. With the benefits of living in the North, such as a high quality of life and affordability, Leeds is well-positioned to leverage the “settle where you study” trend, thanks to its growing private rented sector offerings.

The role of corporates and education in shaping the future of Leeds

Corporates increasingly recognise the potential of Leeds and are collaborating with educational institutions to tailor courses that align with the evolving needs of the city’s economy. This shift is becoming an integral part of the office market, as educational use plays a more significant role. A prime example is Trinity University’s recent leasing of 1 Trevelyan Square—a prominent 83,000 sq ft office building that had been earmarked for redevelopment into a multi-let office space. Instead, the university has signed a long-term lease, transforming the entire building into teaching facilities. This trend is not isolated; the Global Banking School’s recent expansion and other transactions in the works demonstrate that educational institutions are increasingly investing in Leeds’ urban fabric.

A noticeable transition is underway in Leeds. Understanding and anticipating this evolving "DNA" is crucial for unlocking the true value of the city's real estate sector.

Manchester 

Written by David Porter, Partner, Office Head in Manchester.

The economic strengths of Manchester

Manchester has solidified its position as a major economic hub, with significant opportunities emerging in the commercial real estate sector. Manchester continues to attract global businesses that are setting up highly skilled innovation centres, signalling a move away from back-office functions. This shift is driven by the city's and the wider region's highly educated local workforce, which provides a rich talent pool for industries such as tech and media. We are now creating places for companies to base themselves with a highly skilled workforce, making Manchester a key location for businesses looking to expand outside of London.

Businesses are seeking modern, high-quality spaces to attract and retain top talent. These developments are vital for creating an environment where companies can thrive. It's important to offer desirable spaces to attract talent. Employers wanting to provide the best space they can to attract and retain the best talents they can, and they're locating themselves in areas where they can see growing their business.

Education and skills: building Manchester’s talent pipeline

One of Manchester’s core strengths is its proximity to world-class universities, which contribute to a steady flow of skilled graduates into the local job market. For years now, there's been a lot of collaboration between the public sector, universities, and key employers in Manchester. This collaboration ensures that businesses have access to a well-educated workforce tailored to their needs.

A long-standing and proactive collaboration between local authorities, education institutions and the private sector ‘gets things done’. The city has many examples of this, including Spinningfields Manchester Science Park and the exciting proposed development at SISTER.

The University of Manchester and Manchester Metropolitan University (MMU) together have around 90,000 students in total. Include all 5 universities across Greater Manchester – Salford, Bolton, Royal Northern College - and the figure increases to 124,000. One of the largest student populations in Europe. If we took a conservative 40% retention, this means an additional 18,000-20,000 graduates every year wanting to live and work in the Manchester city region.

Graduates are drawn to the city by its good job prospects, culture and being a fun place to live. Companies are heavily recruiting graduates who are being retained in the city.

For commercial real estate investors, this means an increased demand for commercial spaces that can accommodate businesses eager to access Manchester’s highly skilled talent pool. By aligning property developments with the needs of these businesses and their workforce, investors can secure long-term tenants and benefit from Manchester’s dynamic and growing economy.

Sheffield

Written by Rebecca Schofield, Partner, Office Head in Yorkshire. 

South Yorkshire’s strengths: from advanced manufacturing to green energy

Sheffield and the wider South Yorkshire region are key to fuelling national growth. Leveraging its central location and strong connectivity, the region has become home to a growing number of high-growth, global companies across diverse, thriving sectors that significantly contribute to the national GDP.

The region is full of ambition, optimism and energy. As well as remaining a manufacturing powerhouse globally through advanced manufacturing and engineering, it has seen newer strengths and specialisms advance. This includes creative, tech and digital; energy and green and low-carbon industries.

South Yorkshire is home to the Advanced Manufacturing Innovation District (AMID), the UK’s largest research-led advanced manufacturing cluster, driven by the region’s proud and strong manufacturing history, two world-class, leading universities and collaboration between the public and private sectors. As a world-leading centre for vocational training and apprenticeships, The Advanced Manufacturing Research Centre (AMRC) develops skills and technologies to support the UK’s industrial base.

Driving wellbeing in the region

The region also features the Advanced Wellbeing Research Centre (AWRC), a pioneering institution focused on wellness, health prevention, and enhancing quality of life. There is also a continuing push for the benefits of the nearby first national park, The Peak District, encouraging the ever-important work-life and wellness balance.

With strengths in medical device prototyping and production, South Yorkshire is also a global leader in the healthcare sector.

Education Technology hub in Sheffield

The EdTech cluster is now well established in the region, particularly in Sheffield, making it a significant national hotspot. Research from Sheffield Digital, the city’s digital industries association, shows that more than 60% of the UK’s digital teaching resources are managed from Sheffield.

Explore our latest UK Cities DNA research 

Our UK Cities DNA research highlights what currently impacts commercial real estate across the UK to provide a regional perspective that explores asset repositioning and other factors. Explore the role of UK cities in the National Economy and how the largest UK cities are major direct and indirect contributors to the national economy, accounting for 61% of GDP.

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