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Alder King’s mid-year Market Monitor confirms improved demand and pressure on supply in first half of 2013

wantspacegotspace.co.uk - Alder King’s mid-year Market Monitor confirms improved demand and pressure on supply in first half of 2013The first half of 2013 saw improved demand and continued downward pressure on the level of supply in both the office and industrial markets, according to Alder King’s Market Monitor Update, a mid-year review of the commercial property market across the South West and South Wales.  With the return of speculative office development and pre-lets and pre-sales on several industrial and mixed use schemes, the report confirms an encouraging improvement in market sentiment.

Office take up has improved in most key centres including Bristol, Bath, Swindon, Gloucester, Cardiff, Exeter, Plymouth and Truro.  In Bristol, the quality and number of larger active enquiries for over 20,000 sq ft has increased and, for the first time in several years, major pre-let enquiries are active in the market.  

The supply of Grade A specification office accommodation in the city continues to reduce, with under 290,000 sq ft immediately available in central Bristol and less than 30,000 sq ft in North Bristol.  The fall in supply has prompted the return of the first speculative development in the city for four years, with new schemes at 2 Glass Wharf and 66 Queen Square.  

In the industrial sector, the lack of good quality, immediately available modern buildings continues to impact on take up levels.  There has not yet been any speculative industrial development although this is likely to occur on the back of pre-lets and pre-sales; further design and build activity is also increasingly likely, as evidenced by WBC’s recent acquisition of 20,000 sq ft in the Warmley area of Bristol.  

The retail sector continues to struggle but is buoyed by demand from food retailers and convenience operators and the health and fitness sector remains strong in out of town locations.

Competition amongst house builders for good quality locations in the South and South West is strong and driving up land prices.  The strongest demand is for mixed family housing sites but there are early signs of renewed interest in apartment schemes, particularly in Bristol.  

Simon Price, head of agency at Alder King, says: “The evidence of the past six months shows that the offices, industrial and residential development land sectors of the market are showing encouraging signs of improvement which, if maintained through to the end of the year, would confirm a real step-change in market sentiment.”

Alder King’s Market Monitor Update provides an overview of the commercial property market in Bristol, Cardiff, Swindon, Gloucester, Bath, Taunton, Exeter, Plymouth and Truro.  The report is available to download from www.alderking.com/publications.

Posted by The Editor (wantspacegotspace) on 8th July 2013 (updated 14/07/2013)

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