East Midlands buoyed by signs of revival
THE commercial property market in the East Midlands has been buoyed by signs of revival over the past 12 months according to Innes England's latest Market Insite report
The Innes England Market Insite report has been monitoring the regional property market over the past decade – providing individual focuses on Nottingham, Derby and Leicester.
Across the region, the 2014 report highlights:
• an increase in confidence following rise in GDP growth for 2013 – as evidenced by an increase in activity
• the region is set to benefit from enhanced transport and leisure facilities following multi-million pound investments
• Increased activity and construction across East Midlands sees encouraging regeneration for the region
Robert Hartley, managing director, said: “The property sector has experienced another challenging year, but the signs of revival are clear to see. A series of major schemes announced in 2012 are well underway and are set to give the region a boost this year.
“As well as the approval of a £50m investment by Nottingham City Council to improve intu Broadmarsh in partnership with the centre’s owners, the city’s transport network has been receiving a dramatic overhaul. The £570m NET extension, which will double the city’s tram network by the end of 2014, and the revamped train station will make the city centre even more accessible and enhance business in the area.
“Meanwhile in Derby, work on the new £27m sports arena and velodrome on Pride Park have progressed well, as has the £100m Castleward regeneration scheme. The pre-let of a 632,000 sq ft warehouse at Derby Commercial Park to Kuehne & Nagel for Heineken – the city’s largest ever industrial pre-let – illustrates returning confidence.
“Takeup of industrial space in Leicester is at a record high – double that of ten years ago – led by the commitment by DPD UK for a new 330,000 sq ft warehouse unit at Hinckley Commercial Park, while investment market activity has recovered following a difficult 2012.”
The property market in the East Midlands echoed the long-awaited upturn of the economy in 2013, with all sectors reporting improvements on the previous year.
“The number of significant deals being done in the East Midlands is indicative of the mood across the country,” he said. “Industrial and distribution was the star of the show, but everything from retail to the office market exhibited signs of revival.
“Yet again, the lack of supply of grade A space across the commercial and industrial sectors throughout the region creates cause for concern. The market remains flooded by poor quality second-hand space, which limits activity in the area.”
The Bank of England’s low interest environment and other government policies finally took effect in 2013, with GDP growth predicted at one and a half percent – the strongest in five years. Help to Buy stimulated the housing market, helping to fuel confidence that was reflected in an increased number of residential land sales.
“Undoubtedly 2014 will continue to pose challenges to the commercial property sector, but the improvement in the UK economy seems to have gained momentum and I hope that we are able to look forward to this year with some confidence,” Robert added.