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North West Commercial Property News - Sunday, December 4, 2016

Issue #78

Pushing HARD

North West News

Debates about Brexit, the election of Donald Trump and globalisation take the headlines but Manchester sails on in its grand concept of being an international city.

Ambition drives it and the latest sign of this is that Manchester is to expand its presence at next year’s MIPIM show in Cannes. The main reason is because of the exposure it gives to international businesses.

Manchester has been involved in MIPIM for many years but it has apparently made the step change to occupy a whole pavilion of 456 sq.metres (4,906 sq.ft.) on Le Croissette, the area adjacent to the exhibition hall.

Sheona Southern of Marketing Manchester said: “The Manchester region has a long and successful history with MIPIM and we have grown our presence steadily since we first exhibited in 2000”.

Meanwhile, the city is in good heart as analysed by Lambert Smith Hampton with investment increasing by 8% in the first nine months of the year compared with a year earlier while the national picture was a 37% fall.

Investment was particularly buoyant in the third quarter after the Brexit vote, bringing the total up to £615 million, boosted by the sale of such landmarks as 1 St Peter’s Square for £164 million and Greengate at £110 million.

Abid Jaffry of Lambert Smith Hampton commented: “Although you might expect that the recent high levels of investment in the North West has largely come from overseas buyers taking advantage of the devaluation of sterling, that is not necessarily the case.

More than half of the spend in the third quarter came from UK based investors”.

He believes that the strength of the regional market means this level of investment activity is continuing. It is significant that investment so far has been well spread between different sectors such as offices, retail, industrial and hotels.

The growing attraction of Manchester is illustrated by M&G choosing the Northern Quarter for its first entry into the private rented sector in the north of England. It will fund a £27.6 million scheme of 136 private rented homes at 97 Port Street to be developed by Mulberry.

There will also be commercial space.

Alex Greaves of M&G said: “This investment marks our entry into the strong regional market in the North West, further extending our significant engagement in the UK private rented sector, which includes partnerships and deals with housebuilders Crest Nicholson and Telford Homes”.

ON A HIGH IN Liverpool

North West News

Like the constant flow of the River Mersey, the tide of change continues in Liverpool with new and refurbished buildings.

The development of the former Cains Brewery site has been boosted by a doubling of the number of homes in a PRS led scheme compared with earlier plans.

The £250 million project with 1,416 homes will also have a 196 bedroom hotel and micro brewery.

Owned by the Dusenj family, it will go ahead when a joint venture partner is found by Colliers International.

It has pre planning approval.

In fact the draft local plan was published this autumn and envisages building 25,872 homes in the city.

In the pipeline, of course, is the vast Liverpool Waters scheme by Peel and the £1.5 billion regeneration of Kings Docks and Lime Street railway station.

Planning permission has now been obtained by the joint venture of Moda Living and Apache Capital for the 34 storey Lexington Tower which is an early part of Peel’s £5.5 billion Liverpool Waters. There will also be amenity space.

Lindsey Ashworth of Peel commented: “Lexington is set to be a major milestone for Liverpool Waters, it will be a transformational development and build momentum ahead of further announcements for our multi billion pound project”.

This is not the only tall building planned for the area because Your Housing Group (YHG) plans a 30 storey tower of 276 flats at Princes Dock in Liverpool Waters. The group owns 33,000 homes in the North West, Midlands and Yorkshire and is heavily involved in the regeneration of the Anfield area in Liverpool.

Like other cities, Liverpool has a substantial number of new student apartments being built. The latest is a 1,085 unit project by Unite in the city centre alongside Grand Central Student Village. It will be home for 2,500 students.

Richard Simpson of Unite said: “This development will help to meet the strong demand for student accommodation. We will continue to progress our secured pipeline which remains focused on regional locations”.

Tech DRIVE

North West News

Manchester understands the vital role that technology innovation is playing in its growth and wealth creation and is now second only to London among UK regional cities in this activity.

This has been confirmed by the YouGov survey for WiredScore on the basis of Manchester having the second biggest cluster of tech companies and start ups outside London.

Among the reasons listed for Manchester’s success (by 77% of the respondents) are transport links, followed by the pool of local skills and talent, together with the city’s industrial heritage.

More than half the respondents list property and rental prices in making Manchester an attractive place for UK based tech companies.

Perhaps the most significant finding is that only 27% feel that a lack of confidence in the local economy is a barrier to more companies operating in the city.

So, the well known Mancunian business confidence rules.

Key areas for improvement cited in the survey are better business provisions, with 31% saying that technology, office space and amenities could be improved.

The commercial real estate industry has a critical role to play in sending a message that Manchester is the perfect city to start a business.

Sir Howard Bernstein, Chief Executive of Manchester City Council, said: “Over the past 40 years, I’ve witnessed a dramatic change in Manchester’s local economy but today the city is on the verge of assuming its potential as a global leader in the digital economy”.

Graham Benson of Manchester Digital and CIO of RentalCars.com said: “Manchester is at the heart of Britain’s thriving tech scene.

However, to ensure its future as an incubator for innovation, it is crucial that we build an environment where businesses can thrive”.

TWO SOLD ON Manchester

North West News

The importance of Manchester is highlighted by the decision of two developers to work in the city.

WeWork, a highly successful operator in London, is seeking sites (perhaps as many as three) in Manchester in its first move outside the UK capital.

In the case of the other developer, Hines, this is a return to the city and it is now bidding £85 million for the iconic 26,012 sq.metres (280,000 sq.ft.) Royal Exchange which is being sold by Starwood Capital and Trinity Investment Management.

PROPERTY profile

North West News

Altitude Atlas Business Park Manchester Airport Description Altitude offers fully refurbished office suites arranged over three floors from 5,000 sq.ft. with 231 on site car parking spaces and excellent road, tram and airport connections.

Location: The property is situated within a 10 min. drive of the cosmopolitan villages of Wilmslow, Didsbury and Cheadle. Handforth Dean, the home of John Lewis and a David Lloyd Health Club is just a 5 min. drive away. Manchester Airport also offers a range of shops and restaurants as well as conference facilities.

Specification: Fully accessible raised floors, 4 pipe fan coil air conditioning, suspended ceilings with LED lighting, shower facilities, large efficient L shaped floor plates, ceiling height of 2.7m, male, female and disabled WC facilities.

Rent: £16.50 per sq.ft.

Enterprise Zone: Altitude is situated within a Government backed Enterprise Zone. The Council therefore has the discretion to grant an enterprise zone business rate discount.

Contact James Dickinson, Canning O’Neill, Tel: 0161 244 5500 Dominic Pozzoni, Colliers International, Tel: 0161 831 3300 Rob Yates, Cushman & Wakefield, 0Tel: 0161 235 8998

InBrief #1

North West News

900,000 sq.ft. of industrial warehousing will be coming onto the market including M&G’s 378,942 sq.ft. Warrington 379 building, Asda’s 322,000 sq.ft.

Wigan shed & St Modwen’s 199,250 sq.ft. unit at knowsley Industrial Estate, Liverpool.

Winning ON ALL FRONTS

North West News

Any question about Manchester’s continued success can be answered by listing the variety of factors that have made this possible.

For a start, there is the dynamic and expanding airport, second only to the major London airports, followed by the massive success of MediaCity with the vastly expanded BBC operation and rebuilding of Salford Quays which has brought an expanded new business district and new residential area together with a revived Manchester Ship Canal.

Underlining the importance of MediaCity is a new £20 million hotel and office development for businesses in the creative, digital, media and broadcasting sector.

It acts as a gateway to the area and has a 112 bed Premier Inn on an upper storey.

Stephen Wild of MediaCity said: “The Premier Inn is a major addition to the city as both a thriving business and leisure destination. Our recently approved plans to double the size over the next 10 years means more hotels, bars and restaurants which will be vital to the success of creating a fantastic environment in which people can live, work and play”.

According to Russell Quirk of eMoov.co.uk, the decision of the BBC to move to Salford in 2011, bringing with it a host of job opportunities and existing employees looking for properties “looks to have elevated the local Salford property market. Since they started to move in May 2013, the average house price in Salford has increased by more than 30%”.

That is one reason why the refurbished Exchange Quay has been such a success for Hunter Real Estate with a string of lettings, the latest 1,003 sq.metres (10,800 sq.ft.) to JLA Group. This followed a letting of 8,736 sq.metres (94,034 sq.ft.) to the financial group AJ Bell through letting agents, Canning O’Neill and Savills.

Jeremy Birkett-Jones of Hunter said: “The momentum at Exchange Quay is showing no sign of slowing as the space is being steadily snapped up”.

LIP HING IN Trafford Park

North West News

As ever Trafford Park remains a favourite venue for industrial companies with Lip Hing Manufacturing leasing 1,453 sq.metres (15,640 sq.ft.) at Lothbury Property Trust’s Premier Park.

This leaves four units available at the park. Richard Johnson of JLL who acted for Lothbury said: “With over 1,400 businesses, Trafford Park is one of the north west’s key hubs for the industrial and logistics sector”.

“There is a shortage of supply of Grade A industrial/warehouse space at the park with Premier Park being the only multi let scheme to offer 24/7 on site security”.

JLL also acted in the sale of the final unit at Buckshaw Village’s Matrix Point with a sale to Elite Tele. In addition, Euro Garages has taken the remaining design and build site.

Chancerygate IN CHORLEY

North West News

Ever active Chancerygate has acquired the 4.6 acre Matrix Park site in Chorley, Lancashire currently occupied by Barclay & Mathieson (B&M Steel) who are moving to another location.

B&M occupy a 4,366 sq.metres (47,000 sq.ft.) unit which was built in 2003.

Mike Walker of Chancerygate commented: “The site offers a number of angles when B&M finalises its relocation. We will undertake a comprehensive refurbishment of the existing unit”.

There is also sufficient land for an extended building nearly doubling the size or another stand alone building. Savills advised Chancerygate.

PULL OF THE airport

North West News

The other peg to the Manchester success story is provided by the airport whose property attractions seem unbounded at the moment.

Two property companies, Stoford and Mountpark, both noted for their experience and shrewdness are reported to have combined to bid for the remainder of the land at Airport City Manchester with the intention of building an industrial zone of 111,480 sq.metres (1.2 million sq.ft.).

The 37.3 acre site is part of Global Logistics which is south of Mancester Airport. Mountpark has been involved in the site through its development of a big shed for Amazon which is now being sold for £40 million. DHL was the first occupier to move into the area.

Meanwhile, the Airport City joint venture has forward sold the 12,077 sq.metres (130,000 sq.ft.) ALPHA unit for £12.2 million to LaSalle Investment Management.

It has a range of units up to 3,251 sq.metres (35,000 sq.ft.) and will be ready for occupation in January 2017.

LaSalle has bought it for the Greater Manchester Pension Fund (GMPF). LaSalle’s Katie Hynard said: “Average industrial levels for the north west region have remained stable over recent years and south Manchester has always been popular for occupiers due to its proximity to strong road and other transport links”.

Lynda Shillaw of MAG Property added :“We’re continuing to receive strong interest from the occupational market and investor confidence in the development remains strong”.

Two new occupiers, Lime Supply and Posilan, are taking space at the World Freight Terminal. Both have taken small facilities but with the attraction of easy access to their customers.

In an odd sale that reflects how airports have acquired assets for expansion, MAG Property has sold two large houses in Mobberley. Hobcroft House has 10 bedrooms and was once the home of Everest pioneering climber George Mallory whose frozen body was found near the summit a few years ago.

The other property, Holly House, has five bedrooms and, like Hobcroft House, it needs extensive refurbishment.

SWINTON MOVES TO Embankment

North West News

Swinton Insurance has signed a leaseagreement forall165,000sq.ft.

of Grade A office space at 101 Embankment inwhat is the largest property letting deal inManchester city centre in recent years.

The investment in Embankment enables Swinton to bring its head office and customer facing teams into the same location for the first time.

More than 1,000 employees will relocate to Embankment from existing city centre sites on Whitworth Street and Great Marlborough Street.

Embankment is a two phased Grade A office development which is being delivered by Ask Real Estate in a joint venture with Carillion plc and Tristan Capital Partners, and in partnership with Salford City Council and Network Rail. Planning consent for the second phase of the scheme, 100 Embankment, was granted in July.

On behalf of the joint venture Managing Director of Ask Real Estate, John Hughes, said: “This is a great coup both for Embankment and for the cities of Salford and Manchester and we are delighted that Swinton has chosen Embankment as its future base in this location of the city”.

WHR Property Consultants advised Swinton. CBRE and Cushman & Wakefield are the letting agents on the scheme.

InBrief #2

North West News

Davies Harrison’s Rick Davies points out that the 5,000 sq.ft. to 30,000 sq.ft. industrial market remains relatively strong despite the Brexit vote. “The small business owner is not holding back. It’s really a good, healthy market”.

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