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Martin Crosthwaite, of Crosthwaite Commercial, tells us about the Sheffield property market

wantspacegotspace.co.uk - Martin Crosthwaite, of Crosthwaite Commercial, tells us about the Sheffield property marketIs Sheffield the land of opportunity at present? Certainly outside bargain hunters are now looking at the city and purchasing buildings for figures way below market levels from 5/6 years ago!
One only has to look at Aspect Court, a 57,000 sq ft office building let to Sheffield Hallam University which sold recently for £3.1m, a 16% yield and some £6.4m LESS than it was sold for in 2005. On the industrial side, well let older buildings can be bought for around 10% yield. The old adage, “cash is king” is truer today than it ever was and companies and individuals looking to better the paltry returns from bank deposits  are reaping rewards in what can only be a rising market.
The opportunities available around empty offices are being exploited by residential developers, particularly those looking at student schemes where rents for a student let can equate to more than £20 per square foot, more than four times the rent that a landlord could achieve as offices, assuming a tenant could be found! With empty office buildings available for as little as £35-£45 per square foot, one can see the attraction to developers and with The University of Sheffield and Sheffield Hallam University having some 60,000 students between them, the demand for good quality, city centre student beds remains strong, possibly at the expense of some of the more suburban student houses on the perimeters of the city.
Indeed, the universities themselves are currently two of the most active developers in the city with University of Sheffield having recently received final approval to demolish the listed former Jessops Hospital and replace it with an £80m engineering centre, whilst Sheffield Hallam have a £100m plus development programme planned over the next 3 years.
Retail wise, the continued delay by Hammerson to commit to the Sevenstone shopping scheme is a major problem in the city which needs resolving sooner rather than later. On The Moor, however, Scottish Widows plans are well advanced with the new 200 stall Market Hall now taking shape and due to open later this year. Alongside will be a block of 6 new retail units and further phases will follow transforming The Moor into much more of a modern destination for shoppers.
Sheffield City Council is currently considering proposals for a new 400,000 sq ft Ikea store close to Meadowhall, by the M1. Whilst the location may not be ideal, tempting more shoppers out of the city centre, the general view seems to be that if Sheffield is to retain its position as a major regional centre, the likes of Ikea should be welcomed, but not at the expense of further investment in the city centre, particularly on retail schemes.

Posted by The Editor (wantspacegotspace) on 27th April 2013 (updated 10/05/2013)

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