Kent, Surrey & Sussex

Property News Index

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

South East SURGE
HEALTHY Kent
MIGHTY Acorn
Ashford ADVANCES
TRANSPORT is key
PROPERTY profile
InBrief #1
VISIONARY Croydon
STILL A shortage
GILDING Guildford
InBrief #2
Prospero Redhill Flude

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Kent, Surrey & Sussex Commercial Property News - Monday, March 6, 2017

Issue #52

South East SURGE

Kent, Surrey & Sussex News

It may be surprising, but the strong performance of the UK economy and a high level of confidence is defining the commercial property market in many parts of the UK including the south east.

This healthy situation is underlined by the RICS survey for the last quarter of 2016 with a rise in investment in all sectors, improved occupier demand, notably for the industrial sector, and the expectations of rental and capital growth in the regions.

That is in stark contrast to forecasts following the Brexit vote and, in truth, is still to be explained.

However, this greater confidence is reflected in the dynamic performance of Ashford in development and a range of improvements including transport. An interesting aspect of the Ashford developments is that it was always touted as benefiting from its proximity to continental Europe, but now with Brexit the pace of change has, apparently, increased. This same confidence is also behind an expanded role for the inward investment agency, Locate in Kent, which has been given a greater role by Kent County Council and has hired more professional staff.

What has helped Locate in Kent is a successful bid to the European Union Regional Development Fund which has unlocked further funding in addition to the support it receives from KCC, Medway Council, Kent Development Group and private sector partners such as Cripps, the county’s largest law firm.

Paul Wookey, Chief Executive of Locate in Kent, said: “Our new contracts and additional funding put us in a better position than ever before to promote the benefits of Kent and Medway companies looking to launch in or relocate in the county”.

One bellwether of confidence is the amount of new development, particularly large regeneration schemes, two of which are in Woolwich, (which has already gone through a metamorphosis on the back of improved transport) and Guildford, a thriving town in Surrey. In Croydon there have been some key lettings, notably HMRC at Ruskin Square. It is also noticeable that other towns in Surrey have seen increased activity.

HEALTHY Kent

Kent, Surrey & Sussex News

While the media constantly bemoans the performance of the NHS, the development of the private Kent Medical Campus has been boosted by the completion of a new £1.5 million access road.

It allows Cygnet Health Care to start construction of an £18 million, 65 bed psychiatric hospital.

Mark Scally of Cygnet said: “We hope the creation of this new hospital will help ease pressure on the need for specialist mental health provision in Kent”.

The ambitions of the developers for the campus are substantial and it will become an Enterprise Zone in April bringing financial incentives to companies moving to the site.

Gary Watson of agents, JLL, commented: “The completion of the second spine road opens up the site and will enable us to attract other companies. This road, and the arrival of Cygnet, are important steps in our journey to create a home for 4,000 people and making the campus a place for forward thinking businesses in health, science and education”.

When complete, the 30 acre site will provide 97,545 sq.metres (1.05 million sq.ft.) of accommodation for medical and life science companies and specialists’ residential and rehabilitation care, with the aspiration for higher education level training facilities.

Together with the Kent Science Park and Discovery Park it means that Kent has a substantial amount of accommodation devoted to life science and technology, areas of activity that all parts of the UK are trying to attract.

MIGHTY Acorn

Kent, Surrey & Sussex News

The popularity of trade parks is unbounded throughout the UK, as amply shown by the success of the Acorn Industrial Park, Crayford, Kent.

It reported a bumper year for lettings in 2016 with new occupiers Delmark Lifting Equipment. Sun Trade Windows, Hermes, Nationwide Window Cleaning, Safety Lifting Gear and Teamframes all taking units.

The owner, Schroders, has a refurbishment programme for improving the 39,168 sq.metres (421,618 sq.ft.) park, which has industrial units as well as trade counters and is close to the M25.

Tim Clement of letting agency JLL said: “We will be announcing more tenants shortly to bolster the wellknown brands already on the estate”.

Ashford ADVANCES

Kent, Surrey & Sussex News

With the start of construction on a 7,478 metres (80,500 sq.ft.) office as the first phase of the new Commercial Quarter, Ashford has taken a major step towards its goal of becoming the business hub for East Kent.

It is a prime location close to the new Ashford College and railway station, where a new £10.6 million signalling upgrade will allow for the latest Eurostar trains.

The Commercial Quarter will eventually total 54,811 sq.metres (590,000 sq.ft.) of offices together with 150 homes. So far, the omens are good because of pre lets at the first office scheme, International House.

Mark Quinn of developers Quinn Estates said: “This is the biggest office development to be started in the last decade and will bring Ashford to the next level, boost economic growth and enhance facilities for residents with better public spaces and create a range of new jobs”.

The optimistic view of Ashford is given full backing in the Kent Property Market Report produced by Caxtons, Locate in Kent and Kent County Council.

The report notes that improved business confidence has spurred strong office demand across the south east, particularly for quality town centre space which is in short supply. In the case of Ashford, the increase in rents has been helped by the early regeneration projects.

Of real importance is the money being put into transport improvements, such as new road junctions from the nearby motorway. London Ashford Airport is also getting the treatment with plans to extend the runway and build a new terminal to handle 500,000 passengers a year.

The signalling investment at Ashford International Station with key money from the government shows the importance of this link to Europe.

With its enlightened policy of giving the green light to development, final planning approval has been given for a new leisure area with a cinema and seven restaurants at Elwick Place. Indeed, the council is funding the project.

To complete the picture the developer U+1 now has permission for a 120 bed hotel in Victoria Way and the Carrington Group also has approval for its scheme of 59 apartments nearby. U+1 already has planning approval for an Aldi supermarket, 216 homes and a brewery let to Chapel Down.

Planning permission already exists for a 660 home scheme on the former Powergen site in Victoria Way.

TRANSPORT is key

Kent, Surrey & Sussex News

North Kent is a popular area for industrial development and there are also major changes in Woolwich, on the edge of the area.

Here the regeneration of the town has been advanced by the acquisition of the covered market by St Modwen and Notting Hill Housing with the Royal Borough of Greenwich. It is a key part of the £200 million mixed use scheme for the area around Spray Street.

Spray Street is a key component in the regeneration of Woolwich and is helping to create a dynamic new town centre that fits with the major transport changes that have brought in the DLR and will soon bring Crossrail, giving the town connections to every part of London and the south east.

Transport connections obviously underpin the industrial market where Schroders has had a bumper year at its 39,168 sq.metres (421,618 sq.ft.) Acorn Industrial Park, Crayford.

PROPERTY profile

Kent, Surrey & Sussex News

Questor 60, Dartford NOW 60% PRE LET TO PROPER MUSIC GROUP Location: Questor 60 lies within a mile of J1B of the M25, close to Dartford town centre with Ebbsfleet International train station 6 miles away, providing high speed train services to London Stratford and St Pancras.

Description: Questor 60 is a new build scheme of 5 units.

3 units are now pre let to Proper Music Group, leaving Unit 1 (10,851 sq.ft.) and Unit 3 (10,815 sq.ft.) available.

Access: Dartford Station is 1 mile away with services to London Bridge and Charing Cross. The A2 and A20 provide access to central London and cross channel services at Folkestone and Dover.

Specification:  EPC Rating A  BREEAM Rating Very Good  8.5 m eaves height  37.5kN/m2 minimum warehouse floor loading  Electric roller shutter doors  Fully carpeted and heated offices Availability: 10,815 - 21,666 sq.ft. - Leasehold www.questor60.co.uk For further details, please contact joint sole agents: Ian Gutteridge/Richard Turnill at Watson Day 01322 475940 Peter Davidson/Stephen Richmond at Altus Group 01322 285588 Gerry Young/Luca Nardini at Montagu Evans 020 7493 4002

InBrief #1

Kent, Surrey & Sussex News

Turkey Mill Investments have now been granted detailed planning permission for a 2,033 sq.metres (21,882 sq.ft.) office building at Turkey Mill Business Park in Maidstone. Paul Sandby Court (named after the artist and founder member of the Royal Academy) will be built over three floors to a Grade A specification, providing suites from 167 sq.metres (1,800 sq.ft.). Turkey Mill director, John Hawkins, said: “We will look to do the enabling works for the scheme which includes a new bridge over the river as soon as we can”.

VISIONARY Croydon

Kent, Surrey & Sussex News

Croydon has expanded its vision by launching a panel to review the quality of the urban scene and lead to pressure on developers to produce better properties.

Croydon Chief Executive, Jo Negrini, believes that Croydon suffers from an image problem of being of lower quality than other parts of London and wants the panel to assess a wide range of new developments in the borough.

The panel of 22 members is drawn from a range of professions such as architecture, design and engineering.

CBRE’s Jonathan Stoddart noted that consulting the panel before a developer submits a planning application can help but implementation of panel advice can be difficult.

One problem that has arisen in Croydon (and other places, for that matter) is that conversion of office buildings with only minor changes in external features can be ugly.

To some extent Croydon is hoisted by its own petard with the recent spurt of new development. The key letting of the 17,007 sq.metres (183,000 sq.ft.) One Ruskin Square to HMRC has given this £500 million development by Schroder Real Estate Fund and Stanhope a real lift.

When completed Ruskin Square, adjacent to East Croydon railway station, will have 116,125 sq.metres (1.25 million sq.ft.) of prime office space and has the advantage of being close to Hammerson and Westfield’s new shopping complex.

There will also be 625 homes.

James Lass of SREF said: “One Ruskin Square sets a new benchmark for attractive, high quality commercial space and a focal point for the re-emergence of Croydon as a thriving London hub”.

Also in Croydon, Savills has paid £8.03 million for the Progress Business Park on behalf of its UK Income & Growth Fund. In a prime location on Purley Way, the multi let estate attracts high rents, the last deal being at £215.20 a sq.metre (£20 a sq.ft.).

Jamie Pearson of Savills IM commented: “The supply of industrial space within the M25 is diminishing while demand continues to increase. We believe this dynamic will drive rental growth in the coming years”.

STILL A shortage

Kent, Surrey & Sussex News

What is often hindering take up in many towns is the lack of suitable modern offices. However, when the quality product is available, then lettings often follow.

In Reigate, for example, the former bus station has been developed into a Grade A office building of 5,574 sq.metres (60,000 sq.ft.), part of which has now been leased to property consultants Altus Group, who join Deutsche Leasing in the building known as Omnibus.

Nick Woodford, whose firm Maxwell Brown, sold the site to the original developers, Pace Investments, said: “Following the letting of the first floor, the owner, Redefine, wanted to promote more flexible floor combinations for the ground floor”.

Woodford added that “the Reigate office market has made good progress post recession and there is now only a limited supply of Grade A stock”.

It is a similar story for Redhill, he said, with some major transactions in 2016. This year sees the completion of the 4,645 sq.metres (50,000 sq.ft.) Prospero building by McKay Securities with Lamron Estates as development manager in Redhill’s London Road, a prime location.

Mark Skelton of Stiles Harold Williams commented that owner occupiers have not been deterred by Brexit. He cited the keen interest in the 148.6 sq.metres (1,600 sq.ft.) Castlefield Road in Reigate and said: “It still makes sense to own premises and for smaller lots up to around £1 million, there are lots of cash buyers”.

GILDING Guildford

Kent, Surrey & Sussex News

Like Croydon, Guildford wants to improve its image to bring a more acceptable urban landscape and pedestrian provision between the important parts of the town.

The Guildford Vision Group has appointed Nottingham based Leonard Design to create the concept. At the heart of the design is a plan to divert traffic away from the town centre to reduce pollution and give a boost to public transport.

Another part of the plan is for scene space for festivals and other events to be created together with improved pedestrian links between the town centre, cathedral, railway station and the University of Surrey. Further ahead, the hope is that it will bring a new cultural centre, more hotels, 3,000 homes and offices.

John Rigg of GVG said: “Guildford is facing growing pressure that is impacting on housing, businesses and infrastructure. The only choice is continued piecemeal development, which we fear will create a sprawling nightmare with no central strategy or a new vision to create a traffic free Guildford with a true town centre”.

InBrief #2

Kent, Surrey & Sussex News

Also in Surrey, recent lettings by LaSalle Investment Management means that the refurbished Grove House, Leatherhead is now full. James Smith of LaSalle said: “The decision of Haltermann Carless to relocate to Grove House highlights the quality of the refurbishment and the excellent town centre location in this key south M25 town”.

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