Jansons Sorbon

View our extensive range of commercial Office and Industrial properties to buy, lease and rent in the Thames Valley area.

Thames Valley Commercial Property News - Friday, June 2, 2017

Issue #57

On track

Thames Valley News

At a momentous time for the UK as an election looms and Brexit negotiations get into their stride, the focus is on how the economy will cope and confidence be sustained.

Until earlier this year the economy had performed surprisingly strongly and now the evidence is that regions are benefiting from a shift in emphasis away from London, surely of some help to the Thames Valley which is gaining from a number of major transport investments, notably the Elizabeth Line.

Indeed, the imminence of the line opening is of major significance to the region by providing a major link between so many towns with important clusters of technology companies. An indication of this is provided by Savills’ Regional Office Market Spotlight reporting that take up in the UK regions (excluding London) exceeded the longterm average last year with an outcome of 891,840 sq.metres (9.6million sq.ft.).

Savills said the most active business sectors in taking space were insurance and financial services but it is noticeable that the Government Property Unit was taking large buildings. It also forecasts that the two most active sectors this year will be tech based employment and administrative.

Another positive trend for the Thames Valley is that the decline in Sterling has pulled in a greater flow of foreign investment, particularly as it is probably the area of the UK with the highest number of overseas companies, many in the fastest growing sectors of technology and pharmaceuticals. In particular there has been increased investment from the Middle East and Asia Pacific regions but a decline from the United States. Ben Burston of JLL commented: “For many longterm investors, Sterling depreciation provides an added fillip to the investment case, based on their perception that itmay appreciate once there is more clarity around Brexit and its economic implications, but it is not a case of one size fits all. Private investors have responded to the depreciation more than institutions and global asset managers”.

The Thames Valley is benefiting from companies moving out of London to save on high occupation costs, a decision which is being sweetened by the faster transport access to the capital via enhanced railway routes (such as an improved Reading station) and the Elizabeth Line.

THE science WAY

Thames Valley News

A landmark planning decision for the region has come with permission for the development of the remaining 55,740 sq.metres (600,000 sq.ft.) site in the Thames Valley Science Park.

The park, which is owned by the University of Reading, will have 15 new buildings over a 20 year period after Wokingham Borough Council granted planning permission.

Design of the third building in the first phase is underway and a gateway building of 6,503 sq.metres (70,000 sq.ft.) will open later this year fully occupied with 20 technology companies.

The second building is an innovative cancer treatment centre being built by Proton Partners International and will open early next year.

David Gillham of the Science Park said: “With phase one of the park already taking shape, this outline consent for phase two enables us to continue with our ambitious longterm plan to further develop our thriving community of knowledge based companies”. The companies are linking with the university and providing employment opportunities for students.

Haslams and Savills are the joint agents for the park.

ROYAL potential

Thames Valley News

The attractions of an office opposite Windsor Castle have caused Brand Potential to double its current office space at the Grade II listed Number One Windsor.

The company has now leased the second floor of the building in addition to the first floor it already occupies to enable it to expand.

Edward Crookes, Director of Englefield Estate which owns the building, said: “Forging mutually beneficial, long term relationships with our tenants is something we feel very strongly about. Retaining high calibre tenants like Brand Potential is also very important and we are pleased to be in a position to facilitate their business expansion”.

InBrief #1

Thames Valley News

Regus continues with its steady expansion throughout the UK and is opening a 200 station facility in Rourke House, Staines on the Watermans Business Park this year.

It expects significant demand from local small businesses in a town which has excellent transport links and is only 15 minutes by road from Heathrow.

Richard Morris of Regus said: “Staines is a town with a host of leading companies and in particular, thriving tech and pharmaceutical industries”.

Regus now has 2,850 centres in a 1,000 towns in 107 countries.

Providing SPACE

Thames Valley News

The general shortage of logistics space in the Valley is being addressed in the case of Basingstoke with a new scheme by Kier Property on the Houndmills Industrial Estate.

The scheme of three units is being marketed by Lambert Smith Hampton (LSH) and Hollis Hockley under the Kier banner of Logistics City with units available next year.

Adrian Whitfield of LSH said: “This is a speculative development that has already generated significant interest among potential occupiers and demonstrates growing confidence in the region’s economy. Basingstoke has a need for quality, strategically located units of this type that will bring economic benefits and a significant number of jobs to the town”.

Pip Prongué of Kier commented: “We see Basingstoke as a key location, which complements our other industrial sites in Sydenham, Watford, Reading, Oxford, Frimley, Bracknell and Thurrock”. Note the number in the Thames Valley.

Also in Basingstoke, London Clancy has advised Europa Capital and Addington Capital on the sale of the 1,022 sq.metres (11,000 sq.ft.) Daneshill Industrial Estate to a private investor. It is let toWicks andWilson, part of the Crowley Company.

Jim London of London Clancy said: “This demonstrated the continuing strong demand from investors seeking good quality and well let opportunities in regions across all sectors”.

Matthew Allen of Addington Capital said: “It is interesting to see that investors are now considering the industrial market as well as offices for the potential investment gains”.

JOBS OR houses?

Thames Valley News

The clash between the need for employment facilities and the government policy of allowing conversion to residential use could come to a head in West London.

Berkeley’s St George subsidiary has bought the 21 acre Northfields Industrial Estate from SEGRO and has plans for 2,000 homes. This comes at a time when a majority of property developers expect to see an increase in conversion to residential use.

In a study commissioned by Amicus Property Finance, 74% of the respondents expect to see an increase in the number of conversions of under used office buildings (this surely also applies to industrial property).

Ironically, only 4%of the property developers surveyed believe this will have a major impact on addressing the UK’s housing shortage.

Berkeley will work with Brent Council on the scheme and St George’s Michael Bryn-Jones said: “We are working with Brent Council to get them to look at how modern developments evolve and are managed”.

Berkeley has bought the site, which was always zoned for employment use, though within the Alperton Housing Zone, with vacant possession. The real discussion with the council on the scheme will occur this year as Berkeley wishes to finalise the plans by the end of the year.

SEGRO’s Alan Holland said that the estate, which was bought in 2009 when SEGRO acquired Brixton, has ended its usefulness as a modern industrial estate. SEGRO has been rationalising its portfolio for a number of years.

In fact, SEGRO is flexible about what it puts on its industrial estates because in developing the 23,225 sq.metres (250,000 sq.ft.) logistics facility on the former Nestlé factory in Hayes. It joined with Barratt in building 1,400 residential units.

The juxtaposition of housing and industrial buildings was the norm in the Victorian period and earlier, allowing the workforce to walk to work.

PROPERTY profile

Thames Valley News

448A Basingstoke Road, Reading RG2 0RX Description: 448A Basingstoke Road is a modern, detached high office content warehouse/HQ facility.

Location: The building is prominently located in south Reading close to local amenities.

Access: 448A Basingstoke Road is close to J11 of the M4 motorway providing easy access to London, Heathrow Airport and the national motorway network.

Reading town centre and railway station is within 2 miles.

Specification:  26,692 sq.ft. (13,300 sq.ft.

warehouse & 13,392 sq.ft.

offices, reception & training room).

 6-7.2m eaves height  3 phase power  Loading door  Showers Terms: For Sale Freehold Sharps Commercial 0118 939 1600 Parkinson Holt 0118 939 3333

InBrief #2

Thames Valley News

Westbrook Partners is selling the 7,200 sq.metres (77,502 sq.ft.) Aircraft Factory, Hammersmith through GM Real Estate with a price tag of £70 million plus. It is multi-tenanted and is being sold on a net yield of 5.5%.

Westward HO!

Thames Valley News

The demand for industrial space continues to fuel the Thames Valley market after a strong showing in 2016.

According to JLL, 520,240 sq.metres (5.6 million sq.ft.) of industrial space was let in the Western Corridor in 2016, an increase of 9% on the previous year.

The extent of the recovery can be judged by the fact that despite a 4% pick up in supply to 668,880 sq.metres (7.2 million sq.ft.) it was still 45% lower than in 2010.

Melinda Cross of JLL commented: “A vast amount of space was taken up last year and was the highest level of the past five years.

Just over 278,700 sq.metres (3 million sq.ft.) was taken up in West London last year, which was 7% above the five year average”.

Cross added that demand last year was boosted by a high number of smaller transactions and said: “We remain positive about the market fundamentals in the Western Corridor. Additionally the third runway announcement was very positive for the West London and Heathrow industrial and logistics market”.

An illustration of this is the letting of 4,091 sq.metres (44,033 sq.ft.) in Unit 2 Blackthorne Point to Flostream Ltd. It is owned by the Airport Industrial Property Trust (AIPUT) and managed by Aberdeen Asset Management.

Adam Creighton of JLL said: “We have now seen a number of active growth years at Heathrow and 2016 was particularly busy.

Despite the completion of a number of new developments and refurbishments, availability remains low compared with demand”.

What is clear is that the logistics business is going through a major period of change. JLL’s Andy Harding said: “Spurred by the growth of e-commerce and demand for last minute fulfilment facilities, there has been increasing interest in urban logistics among property developers and investors. This is only part of the story, as the issues associated with logistics in cities are much wider than servicing commercial growth”.

Bracknell SLOWS FOR Unit 2 Blackthorne Point, Poyle The Lexicon THE ELECTION

Thames Valley News

Bracknell is another town that will benefit from a new shopping centre with a £240 million scheme for the Lexicon.

The 50,166 sq.metres (540,000 sq.ft.) scheme is a joint venture of Land Securities and Schroder UK Real Estate Fund.

The office market opened strongly this year with the active level of enquiries but Simon Fryer of Fryer Commercial said: “Following a strong Q1 in terms of demand, the Bracknell office market now seems to be affected by political and ‘wider’ uncertainties. Some companies appear to be sitting on their hands but ‘apparent’ demand remains strong. The market is also confused by the number of PDR “aspirations”.


Thames Valley News

Among the warehouse and logistics facilities being built in Oxfordshire is a 22,488 sq.metres (242,067 sq.ft.) facility for the publisher Hachette at Signia Park, Didcot.

The £29.24 million funding is coming from the ever active Tritax Big Box REIT, giving it a yield of 5.82%, and it is being constructed by Winvic Construction and developer Clowes Developments.

Elsewhere in Oxfordshire, MEPC has started construction at Park Drive East, Milton Court in a £24 million speculative office and laboratory scheme of three buildings. There is no doubt the industrial and office market in the county is hot and the advantage here is that it is within the Science Value UK Enterprise Zone.

MEPC’s James Dipple said: “Milton Park is firmly established as an anchor destination for life sciences in our region, particularly due to the close links with the nearby Oxford University and its life sciences division which is ranked first globally”.

The Oxford Science Park is also expanding with its new £13 million Schrodinger Building (named after the Austrian physicist Erwin Schrodinger). The three storey, 5,717 sq m (61,538 sq.ft.) building offers a range of office and laboratory suites. Councillor Bob Price, Leader of Oxford City Council, said: “Oxford’s science and technology base is booming and demand for space is massively outstripping supply”.


Thames Valley News

At a time when retailers are feeling the pinch from rising rents and stagnant sales, the development of new shopping centres, such as the Westgate in Oxford, rolls along.

In the case of Oxford, where Land Securities and the Crown Estates are building a £440 million shopping centre of 74,320 sq.metres (800,000 sq.ft.), the expectation is that it will add £1 billion to the city’s retail spend.

That is mainly because Oxford has lacked modern retail facilities on the scale now demanded by consumers. However, the fact is that for all the hype about online shopping, there is a steady flow of new centres being developed throughout the UK in such places as Sheffield, Bracknell, Croydon, Southampton and many others.

Reading SCORES

Thames Valley News

Reading is benefiting from a number of major schemes, both in terms of refurbishment and new development.

A major new development is the £500 million Royal Elm Park, which will provide a 300,000 sq.ft.

convention centre as well as over 600 new homes and a mix of retail, leisure and hotel facilities situated adjacent to the Madejski Stadium.

The impetus for the scheme by the RFC Property Company comes with the linking of Reading to London via the Crossrail.

Grasham Construction has completed the refurbishment of the 8,853 sq.metres (93,145 sq.ft.) White Building for Boultbee Brooks Real Estate.

Commercial Property Register. All rights reserved. Privacy Policy : Legal Information
Web design and hosting by iWeb Networks Ltd