Swindon’s commercial property market saw limited occupier activity last year, says Alder King in its latest Market Monitor report.
Take-up of office and industrial space in the town was down to its lowest level for several years, constrained largely by the lack of good quality immediately available stock, limited large scale speculative development, the loss of consented sites to alternative uses and fewer corporate enquiries.
The ongoing shortage of quality office and industrial space is a concern, says Alder King partner James Gregory.
“Supply levels have been falling quite dramatically for several years,” he says. “Over the past five years, the town’s available office and industrial supply has fallen by circa 27% and 55% respectively.
“On a more positive note, the industrial market is being boosted by the speculative development of 217,000 sq ft at Symmetry Park which is nearing completion. The former Ecco site at Dorcan, which changed hands last year, is also likely to be brought forward speculatively in mid-2018.
“In the office sector, there is no new office space in the market but 3 Newbridge Square was comprehensively refurbished. Good quality offices at Lydiard Fields and Windmill Hill Business Parks continue to be the best available out of town space.”
Robust demand for industrial space in the 5,000 to 20,000 sq ft range resulted in a new rental high of £7 per sq ft being set for refurbished industrial space. Further upward pressure on rents is widely expected in 2018, fuelled by the shortage of stock and an increase in new build construction costs.
2017 also witnessed a record volume of investment transactions, mirroring trends nationally. Circa £84.7 million of assets were transacted in Swindon, up 85% on 2016. The largest transaction was in the retail sector – IM Properties’ purchase of the Wickes unit on Gipsy Lane from Goldman Sachs for £14.04 million.
Looking to the year ahead, James Gregory said: “With new industrial stock coming to market this year, we anticipate increased activity levels and further rental growth in the town’s property market this year.
Alder King’s Market Monitor 2018 provides a summary of the commercial property market in Bath, Bridgwater, Bristol, Exeter, Gloucester, Plymouth, Swindon, Taunton and Truro. It also covers Cardiff and Newport. The full report is available to download at www.alderking.com/publications. A mid-year update will be published in July 2018.
Pictured above: James Gregory, partner at Alder King, Swindon