Manchester, a city known for its industrial heritage and vibrant culture, is undergoing a remarkable transformation. This metamorphosis is elevating the city to new heights, attracting discerning investors and luxury enthusiasts alike. The streets of Manchester now exude a stylish swagger, with a wave of upscale housing, glamorous dining establishments, and five-star amenities, positioning the city prominently on both domestic and international investment radars.
Leading the charge in this luxury revolution are esteemed names in the hospitality industry. Soho House, renowned for its exclusive clubs, is set to open its first Northern outpost, spanning five floors within the historic Granada Studios. Meanwhile, world-renowned chef Gordon Ramsay has secured three floors of Art Deco splendour on King Street, where he has introduced Lucky Cat, a Japanese concept restaurant inspired by the 1930s Tokyo drinking dens. Joining the fray is Sexy Fish, an Asian restaurant under the Caprice Holdings banner, establishing its third location, following the footsteps of its Mayfair and Miami counterparts.
Real Estate Boom
The property market in Manchester mirrors this upscale trajectory. In the decade leading up to 2022, average rents for one and two-bedroom homes soared by an impressive 45.6% to 77.8%. The average price per square foot for completed residences in prime Manchester postcodes (M1, M3, M4, and M15) surged by a remarkable 42% between January 2019 and January 2023. Notably, Land Registry data from May 2023 reveals an annual price increase of 7.2% in the Northwest, overshadowing London’s 3.2%. Manchester also outpaced London in hotel occupancy growth, registering an impressive 68% over the year ending January 2023.
A City of Distinction
Manchester’s ascent has not gone unnoticed. In 2019, The Economist hailed it as the most liveable city in the UK, and in 2021, Time Out magazine ranked it as the third-best city globally. Lonely Planet, in its Best in Travel list for 2023, singled out Manchester as a must-visit destination, making it the sole UK city on the list. These accolades have contributed to over half of the city’s 100,000 students choosing to remain post-graduation.
A Promising Future
For investors seeking future prospects, several indices indicate that Manchester is a city poised for growth. In CBRE’s 2023 “Which City? Which Sector?” report, Manchester claimed the top spot among 50 UK cities and towns outside London for expected real estate growth across offices, student accommodations, single-family housing, and multi-family housing. EY’s 2023 UK Attractiveness Survey designated Manchester as the UK’s most successful FDI (Foreign Direct Investment) city in 2022 outside of the capital.
Manchester’s Lifestyle Evolution
The transformation of Manchester’s lifestyle has introduced a new level of amenities and attracted a diverse clientele. The arrival of MediaCity in 2011 enticed the BBC to Salford Quays, generating 2,000 new jobs in the initial five years and contributing £277 million in GVA in 2016 alone. Notably, Manchester ranks as the UK’s second-largest consulting market, with 80 FTSE 100 firms establishing offices in the city.
Simon Ismail, Managing Director of Salboy, a property development and funding group rooted in Manchester and Salford, notes, “Manchester is a global brand, on par with giants like Coca-Cola. It’s not just the football clubs; it’s the city itself. Businesses, international students, and migrants, both national and international, are choosing Manchester as their home. The emergence of world-class hotels, private clubs, and Michelin-starred restaurants is most evident in the property market, a trend previously associated only with the capital.”
One such forthcoming development is St Michael’s, a £400 million project located in the heart of Manchester’s city centre. Developed by Relentless Group, co-founded by former Manchester United and England footballer Gary Neville, in collaboration with Salboy, KKR, and Manchester City Council, St Michael’s encompasses a 160-room five-star hotel and a rooftop restaurant by global brand Chotto Motte, complemented by 220 branded residences.
Gary Neville, Director at Relentless Developments, emphasises, “Manchester’s global prominence has grown in recent years. As the undisputed football capital of the world, a staple on the world tour list for major artists, and a magnet for domestic and international investments, Manchester should aspire to be the best in class. We wanted to raise the standards with St Michael’s, and that’s always been the vision.”
The Rise of Branded Residences
The branded residence sector, one of the fastest-growing segments in global real estate, traditionally focuses on luxury homes with price premiums typically ranging from 25% to 35% above non-branded properties. Flora Hartley, Research Partner at Knight Frank, highlights, “Elevated service levels and high-yield potential are the primary motivations for investing in branded residences. Our research indicates that more than one in three prime international buyers are willing to pay a premium for them.”
A Dynamic City Lifestyle
While Manchester has long been known for its world-class music and sports scenes, it now boasts a thriving culinary scene, artisanal food markets, and exclusive members’ clubs, appealing to a new demographic. As the influx of investment and high-end developments continues, the city’s appeal is set to grow exponentially. Manchester is unequivocally on the path to transformation and redefinition.
