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

EXCHANGE the Quay
HP SOURCED
InBrief #1
BRIDGING the gap
MONEY talks
CANNES can!
MERSEY beats
Ball PARK FIGURES
Landmark BUILDING
dunedin Soap Works

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North West Commercial Property News - Thursday, April 4, 2019

Issue #86

EXCHANGE the Quay

North West News

Following the purchase of Exchange Quay a number of years ago, Ekistics and their asset managers Hunters have seen the scheme go from strength to strength.

A rolling program of refurbishments as well as the implementation of a ‘Place Activation’ initiative has resulted in attracting new tenants including Poetic Gem, ProofID and Manpower as well as witnessing existing tenants like Beauty Bay committing to taking more space and expanding.

James Dickinson of Canning O’Neill, the retained letting agents alongside JLL comments, “the place activation has meant that the owners have been able to create a real community on the scheme which previously did not really exist. Occupiers can now attend events including Pilates and Yoga classes and the landlord also arranges ‘pop up’ events which have included ‘Pizza on the Piazza’ and Mulled Wine and Carol singers at Christmas! This has resulted in occupiers talking to each other and giving them the business / social community they want their staff to benefit from” John McHugh of CBRE said: “Placemaking is becoming increasingly important to landlords and developers and is vital to our industry as it explores new and smarter ways of identifying, communicating and delivering a location’s proposition and sense of place."

Richard Wharton of JLL added that “there is growing evidence that thinking about a place holistically can enhance its value. For example, it will increase employee satisfaction, help attract new occupiers and grow rents as tenants are more inclined to remain and expand within the scheme."

Dickinson also commented “There are a number of deals in solicitors hands totalling over 10,000 sq ft that will complete imminently – expect news on these transactions soon!”

HP SOURCED

North West News

Confirming Manchester’s status as a world-class technology centre, Hewlett Packard Enterprise (HPE) will move into Circle Square in 2020.

It will occupy 1,858 sq metres (20,000 sq ft) on the seventh floor. Marc Waters of HPE said: “As we continue to grow our business in the UK, we are building an innovative work space in the heart of Manchester. The intention of Circle Square is to build a collaborative community of leaders in technology, business arts and science, which is compelling."

Circle Square is a joint venture between Bruntwood and Select Property Group.

Tim Newns of MIDAS, Manchester’s inward investment agency, said: “Since developing the world’s first store programme computer, Greater Manchester has pioneered computer sciences, software programming and development

InBrief #1

North West News

Cromwell Property has sold the 3,330 sq metres (35,842 sq ft) Poseidon House, Cheadle to a private investor for £6.9 million, giving a yield of 6.9%.

Cushman & Wakefield acted for Cromwell.

BRIDGING the gap

North West News

Bridge Properties have completed the refurbishment, re-branding and relaunch of Eden Point in South Manchester after a significant 12 month investment programme which will substantially transform and reposition the 38,000 sq ft property.

The delivery team have undertaken a comprehensive remodelling and refurbishment of the 14,000 sq ft of vacant space along with a new reception area together with the in house Eat @ Eden café with its interactive meeting booths. Additional features / amenities include high end washrooms, wet rooms, changing facilities and external break out areas. The interior design has been overseen by Incognito which is headed by former Space Invader founder Simon Millington and GA Studio who have provided Design and Architectural advice.

Located in a highly prominent position fronting the A34, Eden Point now provides design led accommodation over four floors and has already attracted new tenants including Hart’s Chartered Accountants, Purple Patch IFA and Plasma Medical. New lettings have also been agreed with BRIDGING the gap Oakley Technology Group, White Rose Sports Management and event management specialist Entertainment Today.

Speaking about the scheme, James Dickinson, director at Canning O’Neill, joint agents for the scheme with Williams Sillitoe, commented: “Eden Point undoubtedly represents one of the best office schemes in South Manchester. Thanks to the recent opening of the new bypass the scheme offers even better links to the Airport, Manchester’s affluent suburbs and the wider motorway network. Our client has carried out what I call a full ‘defurb’ (removal of suspended ceilings) of the vacant space to provide a less corporate and more modern feel including fully exposed ME which will appeal to many occupiers, where presentation is key."

Paul McCann from developer Bridge Properties added “Adopting a hands on approach that has served us well in the city centre Eden Point represents a long-term hold for us and the level of investment, quality of materials and attention to detail aims to set Eden Point apart from the South Manchester competition” Quoting rental is £18.50 per sq ft and car parking is provided at 1:250 sq ft

MONEY talks

North West News

Clearly funding is available for schemes in Liverpool because Apache Capital Partners has arranged a £58.5 million loan with LaSalle Investment Management for the Lexington scheme at Princes Dock.

Apache is the partner of MODA in this £90 million build-to-rent scheme, one of the largest property investments in Liverpool for years.

Lexington is a 32-storey, 325 apartment high specification project that would also have a substantial amount of amenity space, including a cinema.

Also in Liverpool Waters, Everton Football Club is proposing to develop a new stadium at Bramley-Moore Dock, an abandoned piece of the docks in the north of Liverpool. That will allow the club to develop its existing Goodison Park home for residential and commercial use.

Lord Heseltine, a champion of regeneration in Liverpool, commented: “The involvement of a major football club like Everton as the spearhead of this development is hugely beneficial to the renewal process. This is not just for the immediate environment around the stadium facility but is of regional importance to the city because of the wider economic impact."

He added that: “All that investment combines to create an atmosphere in which other businesses want to be involved and other growth projects emerge. Everton’s plans would change the whole tone and attitude towards the local area, so would serve many purposes beyond the primary sporting purpose.”

CANNES can!

North West News

Given the strong performance of the commercial property market recently in Manchester, the city had a buoyant message to tell the recent MIPIM exhibition in Cannes.

Council Leader Sir Richard Leese said: “We are continuing our work promoting Manchester on an international stage and we want to show us as a city which continues to innovate and the breadth of what is happening across the whole of Greater Manchester."

This is the 20th year Manchester has been at MIPIM and the city is represented by 91 organisations.

Sir Richard’s positive message is underlined by the experience of Dominic Pozzoni of Colliers International who said: “We are witnessing a frenetic element to the Manchester office market at present and even seen gazumping of space occurring as occupiers rush to secure Grade A offices.

Last year was a record year for take up (162,580 sq metres or 1.75 million sq ft), well exceeding the 10 year average and as a result supply is limited for the next 12-18 months."

He added that five significant transactions have already reduced supply in 2019 in the city centre with over 9,290 sq metres (100,000 sq ft) of lettings.

Neil Mort of CBRE commented: “The notable deals this year have all been around 1,858 sq metres (20,000 sq ft). Landmark in St Peter’s Square, and 125 Deansgate are the only two buildings set to complete this year placing them in an incredibly strong position."

Manchester’s arrival as the hottest office market outside London is the result of a long-term effort by the council and business leaders, signified by the success of Allied London’s Spinningfields where Moneysupermarket has leased 2,100 sq metres (22,600 sq ft) through Schroder Real Estate.

Schroder’s Jourdan Rajwan said: “This latest signing cements the position of No 1 Spinningfields as the top office space in Manchester that appeals to high quality, knowledge-based technology and professional services suppliers."

Allied London’s Michael Ingall said: “Moneysupermarket’s decision to move to No1 Spinningfields is representative of the evolving digital presence within the estate.” At another part of Spinningfields, 3 Hardman Square, CBRE has handled two lettings of 2,044 sq metres (22,000 sq ft) each to the General Medical Council and In-touch Networks.

Mort said: “2019 promises to be a positive year for the building, with the opening of the cycle hub, which coincides with the completion of the new public realm area, the Field, adjacent to the property.”

MERSEY beats

North West News

One deal that symbolises the revitalisation of Liverpool is the redevelopment of the Grade II listed North Western Halls into a 202 bedroom hotel after some years as student accommodation.

The scheme by Marcus Worthington Group has been funded by a £20 million loan arranged by CBRE Capital Advisors on behalf of the Merseyside Pension Fund.

Joe Bahsoon of CBRE said: “This is part of the ongoing regeneration of Liverpool city centre and will provide a first class station hotel (it is adjacent to Lime Street station)."

The hotel, which has been pre-let to Radisson, receives the second loan of the Merseyside Pension Fund to the Marcus Worthington Group after it funded the scheme at 125 Deansgate in 2016.

The market background is for a steady expansion of hotel accommodation in the UK with Knight Frank predicting 3.3% growth this year. Hotel accommodation in Liverpool is set to increase by 1,161 rooms between 2018 and 2021, said the consultancy Savoy Stewart. However, Manchester tops the league for new regional hotels with an increase of 2,895 rooms in the same period.

The improved climate for development is a factor in JLL completing £1 million of refurbishment of 12 units for Aberdeen Standard Investments at the historic Albert Dock. JLL has delivered 3,716 sq metres (40,000 sq ft) of refurbishment at the Britannia Pavilion and Colonnades area of the dock.

JLL’s Keiran Melfi said: “The refurbishment of the docks (which now have Royal status) will help maintain this area’s role as the centrepiece of the Liverpool waterfront."

The improvement at the dock fits neatly into the large changes taking place along the Mersey by Peel at Liverpool Waters. This is a sure and steady process epitomised by one tenant, the legal services firm Pure Business Group, increasing its space at 8 Princes Dock.

Liza Marco of Peel said: “There has been a tremendous amount of interest in Liverpool Waters and as a result we are now progressing plans for the redevelopment of a building to be known as 5 Princes Dock."

Although the lettings have not always been large, there have been new companies arriving in the docks, such as the Care Fertility Group at 8 Princes Dock; Amazon Management Services at No 1 and McLaughlin & Harvey at No 12. This company is working on the design and construction of the new cruise liner terminal at the docks

Ball PARK FIGURES

North West News

While conventional wisdom suggests that a dynamic London economy has a ripple effect into other parts of the UK, it seems that the same criteria can be applied to Manchester.

The strong performance of the city centre property market and the economy spills out into other parts of Greater Manchester and other parts of the North West.

It certainly helps Warrington which has also created its own individual success story, particularly at Birchwood Park. Patrizia, which manages the park, has created a central hub into an integrated meet, eat and workspace for occupiers and the general public known as the EngineRooms.

Martin O’Rourke of Birchwood said: “The development of the EngineRooms is our most exciting renovation on the park to date.” The park now has 165 businesses employing 6,000 people.

Apart from Birchwood Park, other parts of Warrington have enjoyed a good market, such as Eagle Park where Penlaw, a drywall distributor, has leased 1,305 sq metres (14,049 sq ft), the last of the 13 units, through JLL.

Richard Johnson of JLL said: “With more Grade A estates like this becoming fully occupied, including the nearby Taurus Park, it is important for landlords to refurbish to a high standard where it is necessary to modernise older stock, which can be a key differential in capturing demand."

Another local deal was the sale of a 557 sq metres office unit at Ibis Court, Centre Park, to Moorland Property Solutions who intend refurbishing it.

Daniel Barnes of Savills who acted for the seller, District Estates, said: “We have seen increased interest in opportunities around Centre Park."

Like Warrington, Crewe has become a major hub for distribution and industrial space with one of the latest schemes, the 10,405 sq metres (112,000 sq ft) Q110 facility at Weston Road owned by Cabot Properties and Quorum Estates, being completed by Caddick Construction.

Ian Threadgold of Caddick said: “This is an exciting time for the North West with several large-scale infrastructure projects converging to make the region better integrated with the UK economy."

Caddick also constructed Tunstall Arrow at nearby Stoke-on-Trent, a speculative 12,077 sq metres (130,000 sq ft) scheme by Network Space in partnership with the city council, which is now fully let only a few months after completion. It had grant funding from the Ceramic Valley Enterprise Zone Development Fund.

Richard Munsey of Mounsey Surveyors said: “All units were let or under offer before practical completion which is a first for us. We are not aware of any other speculative scheme where this has been achieved.”

Landmark BUILDING

North West News

John Spencer of Landmark said: “We are making significant investments in our portfolio at a time when demand for flexible workspace is rapidly increasing, from small and large firms alike. We see Manchester as a key city for our expansion, where we are already experiencing a higher number of enquiries since our improvements.”

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