A steady flow of optimistic information and the continued determination to advance major development projects is setting the scene for the recovery in the commercial property market.

That is confirmed by the performance of the office market in 2009 when the total take up of 77,107 sq.metres (830,000 sq.ft.) in the city centre was only 3% down on the five year average, clearly a far better performance than expected.

CB Richard Ellis' Will Kennon said: "2009 was a good year for the North West occupational market, with robust demand and take up in the city centre from both private and public sectors." He is optimistic about the current year because there is a small amount of uncommitted Grade A space being completed and "demand remains positive for good quality stock."

The logical outcome of a tiny development programme will be a shortage of Grade A offices by 2011.

Savills has added its weight to the tightening market view because of the strong market recovery, illustrated by the cutting back of the incentives offered on properties with large floor plates. The view is that 2010 could be the last year when tenants can capitalise on incentives.

James Evans of Savills said: "The Greater Manchester brand has proved very strong over recent months attracting companies such as John Lewis, SPX and BSkyB, which is mainly due to the quality of the new space available and the substantial pool of skilled labour." The challenge moving forward will be to sustain inward investment, though Evans cites the entrepreneurial council and an established national and international platform as providing the basis for success.

For its part the Royal Institution of Chartered Surveyors (RICS) notes in a survey that the commercial property market in the North of England has turned the corner with rental expectations improving. Its survey of members found an increase in enquiries, prompting Jennifer Welch for RICS North West to comment that "it looks like we are beginning to see a return of confidence to certain sectors, although it is very fragile."

SEGRO has sold the 46,450 sq.m.warehouse on Heywood Distribution Park to Fowler Welch Coolchain in the largest deal this year. The company, which will move from a smaller facility at Heywood, distributes consumer goods.

SEGRO has also achieved two sizeable deals at Trafford Park. AKW Group, which already has a large facility on the park, is leasing an extra 7,122 sq.m. on the park and AMC Auctioneers, a new customer for Trafford Park, has taken 3,327 sq.m. One of the largest distribution deals in the North West is at Wilson Bowden’s Kingsway Business Park, Rochdale, where JD Sports will have a purpose built 57,226 sq.m. unit which received planning permission in January. Roger Ellis, Chief Executive of Rochdale Council, said: “Kingsway has enabled the borough to retain an important company and offer them an attractive location to grow their business.”

The efforts of Blackpool to improve its image will take a further step forward with the council’s approval for outline planning permission for Muse Developments’ £220 million scheme for the civic and commercial centre at Talbot Gateway. Master planned by RKTL, construction of the first phase will start in 2011 on the area around Blackpool’s North Station. There will be a new transport interchange and improved pedestrian and cycle routes together with new council offices, police HQ, county/ magistrates’ courts, supermarket, retail space, four hotels, offices and residential units. Earlier this year, Blackpool won an award for ‘Town of the Year’ in the North West for its property development and regeneration.

One of the older properties in the redeveloped Spinningfields, Sunlight House, has been refurbished for APIA Regional Office Fund by DLG Architects in a £3 million renovation. The 9th floor, comprising 1,320 sq.metres (14,206 sq.ft.) has been refurbished to a Grade A standard incorporating full access raised floors and comfort cooling. The quoting rent is £18.75 per sq.ft.

Designed by Joseph Sunlight the 14 storey Grade II mixed use building was the tallest building in the north when completed in 1932 and, apart from offices, it has a bar and gym.

Another of Manchester’s landmark buildings, Property Alliance’s Fairbairn Building, Sackville Street, which has been refurbished, is now fully let though p3 Consultants. Built over 100 years ago, it is named after a famous Victorian engineer and pioneering designer of iron shipbuilding, bridges and multi storey buildings.

Urban Design is selling the freehold of the retail element of Smithfield Buildings, Oldham Street in Manchester's Northern Quarter. All but one of the 21 units in the 3,437 sq.metres (37,000 sq.ft.) complex is occupied. Urban Splash is seeking £6.9 million which would represent an initial yield
of 7.5%.

Scarborough Developments has bought Modus Properties and its seven subsidiaries from Ernst & Young, the Administrator. Among the assets in the North West is the 150 flat Tower Grand scheme in Wigan and the Bridestones, Congleton.

Opus North has paid £3 million for a 4 acre development site currently occupied by an office building (Vestric House) in Runcorn.

One of the most interesting points about the past decade is the way the ambitions in the North West have increased. We had the successful Salford Quays regeneration which has been followed by Peel’s dramatic and city changing MediaCity. Peel followed this by a grand plan to transform Liverpool and the Wirral into something close to Shanghai.

Now there is another vision - the Atlantic Gateway. This would be a £50 billion investment in the area between Liverpool and Manchester, being cited as the North West’s version of the Thames Gateway. At the heart of the plan are Peel’s schemes, either planned or on the way to completion.

It is of huge importance to Liverpool because it envisages a £90 million terminal at Seaforth for large container ships as well as the big Peel plans. Not surprisingly, the 13 local authorities in the region are enthusiastic and will set up a joint planning commission with the priority of improving the infrastructure and low carbon energy.

It is one of the wealthiest regions of the UK with a population of 6 million and an estimated economy of £50 billion and, in the case of Manchester, an advanced broadband network. While it will take decades to complete, it has a potential for at least 400,000 new homes and the creation of 250,000 jobs.

Steven Broomhead of the North West Development Agency (NWDA) said: “Businesses need the right conditions for growth. This means an environment which is not constrained by infrastructure connectivity and municipal competition.” There is a new trend in the UK for local authorities to ditch the competition and co-operate to achieve bigger projects and larger investment.

Interestingly, Markit’s report for the region makes the point that the North West private sector has outperformed the wider UK economy in terms of output, new business and employment up to April this year. What is encouraging is that growth is broadly based in both the manufacturing and service sectors, but particularly strong in the former.

Kingsgate,
North Stockport

Location
Kingsgate is prominently situated fronting Wellington Road North (A6). The central location allows the property to benefit from all the associated amenities and the public transport infrastructure within Stockport and has been key in attracting diverse occupiers to date.

Access
Kingsgate is well placed to benefit from Stockport Town Centre’s train station (750 metres away). Junction 1 of the M60 motorway is also within a 2 minute drive. Manchester Airport is within 10 to 15 minutes to the South.

Description
Kingsgate is arranged over ground plus 6 upper floors. The common parts, WCs and entrance reception have recently been comprehensively modernised. Kingsgate also includes Executive suites enabling the building to offer accommodation on flexible terms for companies from 1 person. Larger suites are also available in wings or full floors. The office accommodation is functional and suits a multitude of densities.

Specification
The specification of the property is as follows:

• Functional accommodation
• Excellent town centre parking
• New glazed reception entrance
• Air conditioning (In part)
• Friendly on site management
• 3 passenger lifts

Further information & Viewings

WHR Property Consultants
0161 228 1001

CBRE
0161 455 7666

Chancerygate has a business model that it has successfully used throughout the UK in its expansion of the past decade. At the heart of it is the quest to tailor developments to suit a variety of clients, but the speciality is really usable small industrial properties which can be let or sold. It is this sensible approach which has brought the success, such as the seven unit scheme at Trafford Park Village. Alistair King of Chancerygate said: “This scheme has done well with all but two units under offer in a three month period, It was a good location for such a scheme and while the market there has been slow in the past year, it has really improved in 2010.” The company has another development in Trafford Park where the units have all gone. “We might look for another site in the area,” said King. He added that “we produce the product the market wants;small freehold units.” One of the largest sites owned by Chancerygate is the 17 acres on Dunningsbridge Road, Aintree, which will be developed as a mixed use scheme with a hotel, self storage property and industrial together with trade counters. It has already exchanged 3.5 acres with a builder/owner for a design and build property. The site in Aintree can offer land for units ranging up to 18,580 sq.metres and, to show its geographical spread, a site in Aberdeen that can accommodate similar sized properties.

Eurohypo of Germany has provided the £123 million financing for the Luxembourg fund manager Aerium for the purchase of the 35,986 sq.m. (387,360 sq.ft.) 3 Hardman Street, Spinningfields. The property, which has blue chip tenants such as Marks& Spencer, lawyers Pinsent Mason and Bank of New York Mellon, has gone into Aerium’s Glenn Arrow UK Property Fund.

Now that it has opted for Peel’s MediaCity, Salford, the BBC is to sell its existing 1,6722 sq.metres (180,000 sq.ft.) building on Oxford Road.

Lambert Smith Hampton is to market the property, which is on a 5.4 acre site, but so far has not quoted a price. The estimated price among agents is that it could be valued at £5 - £10 million. The options are whether to refurbish or build a new property. A likely outcome could be some form of use for educational purposes as it is in the universities district.

One of the latest lettings in the city centre is to the law firm George Davies, advised by OBI Property, moving from Fountain Court, Fountain Street, to Bruntwood’s office at 1 New York Street. OBI’s Will Lewis commented: “We put several options to George Davies, but Bruntwood’s reputation as a landlord and in house expertise put 1 New York Street in pole position.”

Also moving into the building, to the 10th floor, is the planning and design consultancy, Turley Associates, with its 38 strong Manchester team. It has a number of major projects in the North West, including Peel’s Wirral Water project.

Mark Canning of Canning O’Neill said: “While the market is patchy, it is gradually improving as people fish for the best deal. The market is certainly stronger in Salford Quays this year compared with 2009 and Warrington is also buoyant.” Robert Peill of Matthews& Goodman notes the improved market and the efforts of landlords to keep tenants happy and located in their properties to stop them moving.

Northern Trust has bought the former BP/Castrol oil storage and production facility in Manchester with its 16,258 sq.metres (175,000 sq.ft.) of laboratories, commercial and industrial buildings.

The company’s Mike Riding said: “The purchase shows our diversity covering industrial/ commercial properties and our extensive expertise in planning strategies on complex sites.” The company has also had more success at its Birch Court Estate, Warrington, where two units have been let to GB Trading and Cheshire Gas Design.

The improvement in south Manchester has helped Orbit to a flurry of deals in Wilmslow with the letting of four units totalling 1,858 sq.metres (20,000 sq.ft.) at Grove Chambers.

The hard work and intense marketing of Manchester is paying off in a variety of directions, the latest being voted the Best UK Destination by a panel of conference industry executives.They were attending International Confex, an annual exhibition for events organisers which designated Manchester as an ideal destination for major conferences and events. The spin off from this comes through a strong economic performance. Andrew Stokes of Marketing Manchester said: “Manchester is an appealing location for conference organisers with its dedicated conference quarter and a range of exceptional venues.”

Peace has broken out between the competing cities of Manchester and Liverpool as they embrace a bold, and ambitious, plan to create a thriving corridor costing £50 billion for business and living along the Manchester Ship Canal.

Peel Holdings started the process by planning a massive development in Liverpool and the Wirral that will create a skyline that compares with Shanghai and cities in North America with a bevy of skyscrapers.

The logic of thee new plans is that at the other end, in Salford Quays, Peel is building MediaCity, an unrivalled facility for the North West which will house the BBC and others.

The timing could not be better because the commercial property market is improving and it will not be long before agents are pointing to a shortage of Grade A offices. Certainly the office market in Manchester is more buoyant and, in fact, the outcome for 2009 was in line with averages.

In the case of Liverpool, it is gaining from the vast investment of the past decades and looks to have broken out of the stranglehold of a declining port city. Grosvenor’s investment in the fine new shopping area has helped.

The encouraging point about the development plans is that it brings together local authorities in an effort for common good. The Leeds city region is adopting the same, sensible, policy.