4 minute read
PROPERTY
Pandemic and Brexit to trigger real estate shift
New research indicates the pandemic and Brexit could act as catalysts for a shift in commercial property returns on investment in favour of the East Midlands.
In an RSM survey of more than 300 senior real estate experts across the UK in which respondents were asked to rate their top three regions, 70% believe the region will achieve the greatest commercial yields in the next five years.
This places the East Midlands among the top regions expected to generate the highest yields.
London (86%) maintained its position as the region set to see the greatest returns, the West Midlands (85%) came close behind, and the North West (79%) also rated highly in people’s minds.
Residential property was viewed differently, with neither the West or East Midlands featuring among the top three.
Some 86% believe the South West is the region set to see the greatest returns, followed by the South East (82%) and Yorkshire (74%).
The survey also showed that 61% of those based within the East Midlands believe changing working practices will be the largest influence on increased investment over the next five years.
The research goes on to illustrate that typical officebased roles will likely become more “remote-working” in nature, and less London and southerncentric.
Almost two-thirds (65%) believe planning reform will make a difference locally when it comes to Government policy for the sector.
Both HS2 (35%) and the Norther Powerhouse (35%) agenda carried the same belief, with over a third believing both schemes will have a similar impact. Nationally, it seems data centres will upset the traditional order of asset classes over the coming year.
While nearly 70% of all industry experts surveyed see industrial property as the main beneficiary of investment in the next 12 months, data centres accounted for the second highest level of expected investment (56%), usurping residential property as the third most favoured asset (44%).
The private rented sector featured as the fourth most likely asset to see a boost in investment (41%).
Kelly Boorman, partner and head of real estate in the East Midlands at RSM, said: “The global pandemic and Brexit have combined to present economic and geopolitical conditions and prospects that will change the real estate sector for good.
“Our survey supports the notion that both events could be acting as a catalyst for disrupting the traditional order of asset classes as seen with the rise of data centres –rebalancing where in the UK we will see the greatest returns on investment, particularly within the commercial sector in the East Midlands.
“The survey showcases our region is ready to reap the rewards of real estate investment, unlocking value that will only go onto stimulate economic growth for those who live, work and visit the East Midlands.”
Linby warehouse is snapped up
One of the UK’s top railway contractors fought off stiff competition to take over the lease of a warehouse and office in Linby, Nottinghamshire.
QTS Group Limited has let the 25,000 sq ft space at Baxter House on a site near junctions 26 and 27 of the M1 in a deal overseen by FHP Property Consultants.
FHP director Tim Gilbertson, who worked with associate director Chris Proctor, said: “It’s yet another example of the strength of the local market. Demand ranges across all sizes and locations throughout the East Midlands in what remains a pleasingly strong market.”
Further up the motorway near J28, FHP has also marketed three newly-built units at Castlewood Business Park, in South Normanton, on behalf of Clowes Developments.
A 25,000 sq ft space was taken by CST Industries, which relocated from Alfreton, with strong interest in the other units.
Clifton housing development site Newton Garden Village
Nottingham site comes to market
Housing could be built on a 24-acre plot of former agricultural land in Nottingham after a property agent was appointed to sell the site.
Innes England is acting on behalf of its co-owners Nottingham Trent University and Nottingham City Council to market the site on the western fringes of Clifton, which also features surplus university estate.
It has outlined planning permission for a housing development, which would be flanked by open countryside and ancient woodland.
Nearby is the Barton Green play centre and old Clifton village, while it is locates less than half a mile from shops and services, with further amenities in Clifton town centre about a mile away.
Craig Straw, director at Innes England, said the site was already generating interest from national and regional housebuilders.
“It will provide a fantastic housing scheme for families who will be able to enjoy the site’s perfect location – close to Clifton and its array of facilities, as well as Clifton village with its woodland and River Trent walks,” he said.
“This is a great time to be marketing the site, with a backdrop of a strong residential market.”
Meanwhile, Innes England has agreed a deal with housebuilder Redrow Homes to create Nottinghamshire’s first “garden village” on the former RAF Newton base.
It will build 528 homes in the second phase of development on the 250-acre site near Bingham.
Bellway and David Wilson Homes are already delivering the first phase of the scheme. The second phase will be known as Newton Garden Village and will include homes with between two and five bedrooms.
