- Bidwells reveals that Q4 lettings in the residential rental market in Cambridge were dominated by Science and Technology tenants
- 69% of lettings in Q4 were fueled by tenants working across Science & Technology
- The crisis has driven highly-skilled employment opportunities in Cambridge.
The profile of tenants across the city changed significantly in 2020. Households working in the science, technology, or medical sectors were responsible for 69% of Bidwells’ residential rental lettings during Q4, up from just over half in Q3. Such households will remain an important drive of the market 2021 with the ongoing evolution of the city’s R&D base.
The rental market across Cambridge remained remarkably resilient in 2020, as the region’s leading role in the fight against Covid-19 continues to drive tenant demand.
Research has shown that internal moves within the Cambridge market, combined with the ongoing migration of new tenants to the area, drove a 29% increase in Bidwells lettings in 2020 compared with 2019. Activity in December 2020 was 48% ahead of the same period last year.
While Bidwells has seen a steady increase in S&T tenants over the last 2-4 years, the pandemic has been an accelerating factor, which is reflected in the Q4 figures.
Throughout the duration of Covid-19, activity has continued in the city’s university Research and Development buildings and across its science parks. The rush for talent resource has led to quicker recruitment, which in turn has charged rental demand.
The shift in tenant profile is also partly due to an acceleration of wider S&T research and a growing number of science parks in the region, with many new S&T companies choosing to locate in Cambridge. Bidwells are increasingly renting to tenants who work at parks like the Biomedical campus, along with companies such as Apple, Microsoft, ARM Ltd and Amazon.
The unique strength of the city’s research and development base continued to power a steady flow of relocations into the area. The Cambridge market has continued to see a high number of international workers move to the area, primarily for roles in these sectors.
There was also a notable increase in activity from those moving from London during December, representing a quarter of all lettings in the City.
2020 also saw a significant increase in moves within the Cambridge rental market. This is representative of more general trends across the UK market, as tenants, and in some cases former owner occupiers, seek out more suitable homes given their pandemic experience. For instance, homes which are better able to accommodate home working and those with outside space have seen particularly high levels of demand.
This increased level of activity has maintained rental values in the city. Cambridge’s science and technology driven economy has, on average, insulated the market to wider economic challenges. The past three years has seen an 8% total increase in average prime Cambridge residential rent.
Alex Bloxham, Head of Residential Lettings at Bidwells, said: “The unique nature of the R&D industrial base of the city undoubtedly provides the city with a cushion to weather regulatory changes and wider economic uncertainties that are expected during the post pandemic recovery period. Cambridge’s role in the pandemic has allowed the rental market to remain strong.”
“Our data has shown that the profile of Cambridge tenants has been shaped by the industries the city excels in, which is something landlords will need to consider. Landlords will need to think about attracting the types of tenants who are working in the science and technology sectors, proving quality, well-maintained accommodation. The vast majority of these tenants are skilled professionals, which is reflected in the average rental cost per month.”
“There is little sign that the pandemic has had a significant impact on both investor and rental appetite for the Cambridge market.”