At its heart is a strong focus on skills and innovation, which could quietly reshape the office market across the country. As billions are invested in high growth sectors and regional development, a new kind of office demand is emerging, centred on collaboration, access to talent, and flexible, future-ready workspaces.

A major shift is the rise of skills and innovation hubs. These are dynamic environments where universities, businesses, and government bodies work together to advance research, develop skills, and commercialise new technologies - hybrid ecosystems requiring new types of office infrastructure. Collaborative campuses, coworking labs, and adaptable office zones designed to encourage creativity collaborations, these hubs are attracting investment, talent, and office development across the UK.

Sector growth and regional opportunity

The Strategy identifies eight priority sectors, including advanced manufacturing, life sciences, digital technology, and clean energy. Many of these sectors are office intensive, requiring both desk space and specialised environments for research and development, data analysis, and innovation management. For example, the life sciences sector, which received £520 million in manufacturing support, is increasing demand for lab-enabled office space near universities. Similarly, the digital and AI sectors, supported by a £500 million Sovereign AI Unit and a £750 million national supercomputer, are driving demand for high specification, tech-ready offices.

This sectoral growth aligns with encouraging companies to expand beyond London. Manchester, Birmingham, Glasgow, and Leeds are becoming centres for innovation districts. These are areas where office space is integrated with research facilities, training centres, and startup incubators. These districts are not just about real estate but about building communities of innovation that attract both talent and capital.

Innovation districts leading the way

Strong universities, skilled workforces, and targeted investment are making regional cities viable solutions for firms in technology, finance, life sciences, and professional services. Glasgow City Innovation District unites engineering firms, health tech startups, and university researchers in a shared urban setting. Leeds Innovation District, supported by the University of Leeds, Leeds Beckett University, and Leeds Teaching Hospitals NHS Trust, focuses on health innovation, data science, and digital technologies. Birmingham’s Knowledge Quarter is emerging as a globally significant innovation district, backed by universities, local government, and private developers, with a focus on digital technologies, life sciences, and clean growth.

Companies are increasingly choosing office locations based on proximity to skilled graduates and research talent. As the strategy invests in upskilling, especially in AI, green technology, and advanced manufacturing, we are starting to see some businesses are moving away from centralised headquarters towards satellite offices near universities.

Investment and the future of office demand

Public and private investment is key to this transformation. Government funding is often matched by private capital to build or retrofit office space tailored to innovation needs. This includes energy efficient buildings and flexible layouts. The £2 billion allocated to reduce industrial electricity costs supports sustainable office development in regional areas. The British Business Bank’s £6.6 billion in support for startups and scaleups is helping to fill these spaces with high growth companies needing modern, adaptable work environments.

Office demand is no longer driven by headcount or central location, but about being in the right ecosystem with the right partners, talent, and infrastructure to innovate and grow. The UK’s Industrial Strategy is accelerating this shift, positioning skills and innovation hubs as the new frontier for office development. For landlords, developers, and occupiers, the message is clear: the future of the office is collaborative, regional, and deeply connected to the UK’s economic transformation.

Further information

Contact Clare Bailey

Industrial Strategy offers new momentum for place-based growth