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Read about the latest news, views and developments in the commercial property world from our industry expert.

Challenge AHEAD
LIBERTY FOR Horsham
Kent IS KEEN
InBrief #1
AIRPORT’S potential
A PACE setter
ACCESS TO Albany
BOOST FOR Croydon
SUCCESS IN Wrotham
MORE DEALS in Kent
InBrief #2
One Tunbridge Wells Flude

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Kent, Surrey & Sussex Commercial Property News - Monday, November 21, 2016

Issue #51

Challenge AHEAD

Kent, Surrey & Sussex News

Without doubt, Brexit provides a new competitive challenge for the south east that has long basked in its closeness to the continent and its attractions for France and other countries’ companies.

Now those European countries are pushing hard to attract firms from the UK, particularly in the financial services sector. In the new environment, the experienced Locate in Kent and Locate East Sussex have a vital role to play.

Indeed, they are stepping up to the plate and promoting the attractions of their counties, such as the development of new business parks in East Sussex. At the heart of both organisations’ marketing efforts is the attraction of living in beautiful areas offering a better work/life balance.

There are also the improvements in transport, such as the highspeed rail link in Kent and a few new roads, like the Hastings/Bexhill link.

Not to be forgotten is Gatwick airport that is bound to continue expanding even if Heathrow builds the third runway and, indeed, Gatwick might get another runway itself.

Locate East Sussex extols the impact of the 5.5 km Combe Valley Way opening up sites between Bexhill and Hastings, such as North Queensway Innovation Park at its north end with building plots of 2 to 12 acres which could prove attractive to bespoke manufacturing facilities. At the southern end of the road is the Bexhill Enterprise Zone with sites of up to 22,761 sq.metres (245,000 sq.ft.).

Similarly, Sovereign Harbour Innovation Park has a new office, Pacific House, and plots suitable for buildings of up to 7,432 sq.metres (80,000 sq.ft.).

What is impressive about the market is the number of new business parks scattered throughout the region.

There is the Chaucer Business Park at Polegate, north of Eastbourne; the Swallow Business Park under construction at Hailsham and in Uckfield, the Ashdown Business Park which can accommodate a mix of office and industrial buildings and which already has a John Lewis warehouse.

Newhaven is particularly ambitious and eager to take advantage of its port facilities and long history in maritime trade. It also has the advantage of being an Enterprise Zone.

Naturally enough, Lewes also has a major development, in this case a £180 million mixed use scheme in the North Street Quarter on a 15 acre site for retailing and workspace for creative industries as well as housing, a health centre and community space.

LIBERTY FOR Horsham

Kent, Surrey & Sussex News

One of the largest schemes in the three counties is near Horsham where Liberty Property Trust proposes to build 2,750 homes, a 46,432 sq.metres (499,802 sq.ft.) business park and community facilities.

DMH Stallard, the planning firm, is acting for Liberty and its Peter Rainier said: “This planning application is the culmination of six years’ work, which included the incorporation of the site into the strategic allocation of the Horsham District Planning Framework”.

Fundamental to the scheme is the provision of community facilities and services, such as a new campus for primary and secondary schools and another primary school. Within the wider commercial context, there will be shops and sports facilities.

What is important for the concept of a new community with transport improvements at the heart of the development is Liberty’s proposal to set aside enough land for a new parkway railway station on the Horsham-Gatwick line.

That will be useful for the community in terms of access to Gatwick which will surely become a larger operation over future decades.

Kent IS KEEN

Kent, Surrey & Sussex News

According to the Kent Property Market Report 2016 (produced by Caxtons Chartered Surveyors, Kent County Council and Locate in Kent) launched on 3 November, the Kent property market is well placed to overcome any uncertainty created by Brexit.

This is because Kent and Medway have three key factors in their favour:  Kent now has a significant concentration of high value industries, attractive to incoming businesses  Business space in the county is relatively affordable, particularly in view of the recent transport improvements;  Kent will continue to be a gateway to Europe The report confirms that “Kent’s occupational market has seen continued activity with little evidence of the derailment of lettings, a reflection of its strengths”.

InBrief #1

Kent, Surrey & Sussex News

LaSalle Investment Management is the preferred buyer of the £240 million intu shopping centre in Bromley, which is half owned by the local council together with Aviva and intu. It is buying the 43,106 sq.metres (464,000 sq.ft.) mall on behalf of Alaska Permanent Fund Corporation. Investment in shopping centres has been out of fashion since before the Brexit vote.

The shortage of industrial premises is becoming so acute in some areas that it is threatening economic activity. Worthing, for example, seems to have run out of newbuild industrial property according to Stiles Harold Williams, whose Duncan Marsh said: “There is so little supply that a slight spike in demand can lead to a complete lack of high-end availability”.

AIRPORT’S potential

Kent, Surrey & Sussex News

While Brighton City Airport at Shoreham may be relatively small, it is usefully located on the coast and could provide more airport capacity to a larger number of passengers.

In fact, a question that planners might consider is whether it could be used in a similar way to City airport in London’s Docklands with short take off and landing planes giving scheduled flights throughout the UK and Europe possibly in conjunction with Gatwick.

It has the environmental advantages of being close to the sea and with enough land for further development.

The airport has upgraded its office space in the terminal building with a business centre but it also has plenty of industrial and office space available on the airport roads. Among these properties is Hangar One, Premier House with 2,186 sq.metres (23,530 sq.ft.) and several buildings in Cecil Pashley Way such as up to 2,589 sq.metres (27,869 sq.ft.) at No 8, both being marketed by Graves Son & Pitcher.

As far as Gatwick is concerned, the campaign for expansion and a second runway will go on because that is the nature of the airport business. The argument here is that a second runway would create 120,000 jobs and bring a windfall of £1.73 billion to the local economy.

One local agent, James Britton of Roger Coupe, said (ahead of the decision to favour Heathrow) that “the disruption of building work and the concerns about increased noise from extra flights may impact the market but equally, having a bigger transport hub on your doorstep could be a massive boost for the housing market”. There is reason to believe that the argument for expanding Gatwick will go on.

A particular point about airports is their role in freight transport, particularly at Heathrow where the extra runway will play a vital role.

However, it also applies elsewhere and Gatwick is no exception.

Nearby Crawley, said Tim Hardwicke of Stiles Harold Williams, “is a key distribution hub for the south east and the letting of a 2,508 sq.metres (27,000 sq.ft.) warehouse at Camino Park demonstrates the keen interest in units of that size and upwards from B8 occupiers”.

“Availability of units in Crawley and the south east is very low and we currently have a significant number of unsatisfied requirements on our books with few options to offer them”. His estimate is that requirements for warehouse and light industrial is 80,359 sq.metres (865,000 sq.ft.) in

A PACE setter

Kent, Surrey & Sussex News

Something remarkable seems to have happened to Ashford because there has been a breathless flow of significant announcements about new developments and inward investment.

For a start there is a project by Gallagher Properties to develop the former Rimmel factory on the Cobbs Wood Industrial Estate which has been derelict for nearly a decade.

Nick Yandle of Gallagher said: “The approved plan for Carlton Business Park includes a ground maintenance depot for Ashford Council, a ready mix concrete plant for us and 6,503 sq.metres (70,000 sq.ft.) of warehouse units”.

In the centre of Ashford, construction has started on the 7,478 sq.metres (80,500 sq.ft.) commercial centre which will have offices, retailing and restaurants.

Ultimately, the commercial quarter will have 54,811 sq.metres (590,000 sq.ft.) of new commercial space and 150 homes. It is being developed by Quinn Estates and George Wilson Holdings.

Other new schemes in Ashford are: l Land Securities adding three screens to CIneworld including an IMAX screen;  U+1 will develop a £55 million scheme at Victoria Way opposite Ashford International railway station with an Aldi supermarket, Chapel Down brewery and a variety of residential accommodation  Topping out of the £26 million Ashford College for further and higher education.

ACCESS TO Albany

Kent, Surrey & Sussex News

Yet another Kent property has been successful in pre letting units. Albany Capital’s Grade A Logan House in Canterbury already has the ground and first floors let to Access Group before its completion later this autumn. Simon Pentecost, Managing Director of Albany Capital said: “We saw a gap in the supply of quality office buildings that could satisfy the demands of modern, growing businesses. This deal represents a very good news story for the east Kent commercial market”. Martine Waghorn represented Albany Capital and Glenmhor acted for Access.

BOOST FOR Croydon

Kent, Surrey & Sussex News

In taking a new office of 16,722 sq.metres (180,000 sq.ft.) HM Revenue and Customs (HMRC) has given a massive boost to the regeneration of Croydon.

It has leased the space in Schroder UK Real Estate and Stanhope’s One Ruskin Square, part of the £500 million project adjacent to East Croydon railway station and close to the £1.4 billion shopping centre scheme by Hammerson and Westfield.

Covering nine acres, Ruskin Square expands Croydon’s business district and goes some way to creating the major business centre that is intended.

Ruskin Square will provide 185,800 sq.metres (2 million sq.ft.), more than half of which is offices and retailing but which also includes 625 residential units.

The transformation of Croydon into a large business area with additional new housing has attracted technology companies which are now being channelled through a Tech City that has over 1,000 entrepreneurs, software designers and venture capitalists.

James Lass of Schroder said: “The letting of One Ruskin Square in its entirety prior to completion is a strong validation of the London office landscape and to a tenant of the highest quality. Ruskin Square will be a thriving new community and it is a clear mark of confidence that HMRC has picked Croydon for its headquarters”.

This ability to attract new companies is at the heart of such organisations as Locate in Kent that has just assisted its 1,000th company, a German coin merchant, to move to the county. It is taking space in International House, Ashford, the home of the British Numismatic Treasury. Ashford is a major success story in its own right with rapid expansion of new development and inward investment.

Paul Wookey of Locate in Kent said: “The arrival of the British Numismatic Treasury once again shows Kent has a great deal to offer international businesses”.

In sheer human terms the work of Locate in Kent has created or saved 63,000 jobs, it claims.

SUCCESS IN Wrotham

Kent, Surrey & Sussex News

It is a similar story in other parts of the region as shown by the early success of a 15 unit scheme of 3,902 sq.metres (42,000 sq.ft.) by Gallagher Properties at Wrotham, Kent.

Here most of the units were sold prior to completion of the development prompting the company’s Nick Yandle to say: “It is a real achievement at Nepicar Park to sell nearly all the units prior to completion and only 18 months after securing planning permission”.

He added that “speculative development has been rare in the county over the past few years, but we were confident we had understood the market and had the right product, in the right place (on the A20), at the right time”.

MORE DEALS in Kent

Kent, Surrey & Sussex News

Kent is benefiting froman increased flow of new developments as the economy improves, covering all areas of the county.

In Sittingbourne, there are plans for the development of the former Bell House Shopping Centre (including refurbishing Bell House) by Swale Borough Council. The plan is for a mixed use scheme by the Aria Group with 157 homes set around a courtyard, a medical centre, pharmacy and further residential accommodation.

The intention is that the £30 million project should complement other schemes in the town, including around the railway station.

In Dover, there is the St James scheme of 14,577 sq.metres (156,915 sq.ft.) of retailing and leisure in the heart of the town centre that features a six screen cinema, a 108 bed Travelodge, restaurants and shops.

InBrief #2

Kent, Surrey & Sussex News

The development of new business parks goes on, but the town centres get more conversions from offices to residential as in East Grinstead where Decorean has spent £6.5 million on converting Sussex House into 27 flats, 21 of which have been sold. Shraga Stern of Decorean said: “East Grinstead is an attractive location which has seen a shortage of homes on the market”.

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