The news is full of unknowns and economic factors all going in the wrong direction. Is it any wonder that land pricing is no longer at the heady heights of 2021 and early 2022?
Low yields and forecasted rents drove land pricing by effectively double counting growth. This situation coupled with interest rate increases, build cost inflation and the increased cost of borrowing has caused a correction and some of us would say “inevitable” as the super charged market was not sustainable.
This year industrial demand from e-commerce has decreased, 3PL’s can fulfil contacts within existing portfolios and the food and drink sector is feeling the squeeze. The market is simply back to more normal levels of demand.
Brasier Freeth has seen success this year on good quality schemes where land was purchased circa 3 years ago, planning was forthcoming and speculative development was well funded. By way of example Ascent Logistics Park, Leighton Buzzard was developed speculatively as an 8 units scheme from 15-125,500 sq.ft and only 1 unit of 48,639 sq.ft remains available and Symmetry Park, Aston Clinton, Aylesbury 2 of the 3 units were let under construction, again leaving only one unit of 116,487 sq.ft available.
It is true the supply of Grade A units across all size brackets in Herts, Beds and Bucks remains constrained. The counties have stringent green belt policies and understaffed planning departments. Consequently scheme currently on site will let well but there is no doubt that it will be harder to get the numbers on new sites to stack next year without pre-lets.
But are we overreacting, surely we all got too swept up in huge leaps in the market?
Occupiers have certainly been commenting that 45-50% rent increases at review coupled with rising costs (business rates, energy, interest rates etc) were unsustainable.
Following another change of PM there is much for government to do to restore economic stability. The government has the bigger questions to resolve such as trade agreements, value of the pound on the world stage, ensuring no child goes to school hungry, energy security and how to recruit more nurses to name but a few. Industrial landlords may find that they have a part to play by supporting occupiers at this point in the cycle as well as having to accept an absence of the recent levels of rental growth.
Is WFH the future?
The workplace has changed considerably in a short space of time. While WFH is not a new thing, Covid certainly changed the dynamic as to how it is viewed by employees and employers alike. Suddenly the vast majority could be productive while away from the office and remote or hybrid working are now considered normal practice.
However, with the rise of the cost of living crisis, could we see a return to the office for the majority of employees on a part time basis at least?
Certainly, there are a number of employers who would be keen to have their employees back on a more regular basis, but employees needs have changed and it will take far more than a good supply of biscuits and coffee in the kitchen to bring them back. Similarly, it’s not just employers recognising this. If you take a stroll down Clarendon Road in Watford you will see a number of buildings having been refurbished with this very clear message in mind, and that is getting staff back to the office.
Landlords are all seeking to provide best in class accommodation and the phrase ‘flight to quality’ is becoming more relevant, particularly for more corporate occupiers. Whether it is the communal roof top terraces, break out space or the events put on by landlords, the relationship between the building, the landlord and employer is evolving. This is evident in the take up stats in the local market. Across Hertfordshire and the regions, Grade A offices have seen the biggest amount of take up and account for nearly 70% of the transactions in Watford for 2022. This rate gets higher in St Albans where a number of Grade A buildings are being released back into the market.
Consequently new record headline rents are being set in these locations with Watford at £37.50 per sq ft and St Albans now at £41.50 per sq ft. It is envisioned that while stock levels continue to remain low, this trend will be set to continue as tenants seek out the best possible space to tempt their employees back to the office.
With the cost of living increasing considerably, and the chances of a recession possibly looming, it might be that employees feel more at home at the offices that have been designed with them in mind.
The industrial market remains buoyant with good demand and limited supply across all size brackets. Rising rents across the region has been a trend since 2013 but many occupiers continue to be shocked by guide rents and rents at review. This fact has seen the ripple effect continue up the main arterial routes across the region. Demand for freehold units cannot be satisfied.
The supply and demand dynamic are illustrated well in Hemel Hempstead where the largest unit currently available is 2 Centro, Boundary Way 16,600sq.ft at a guide rent of £16.50 per sq.ft. This is unprecedented for such a large industrial area in the southern M1 corridor where the development pipeline for the next 12 months is non-existent. New development will be required to set the next rental tone.
Using the same rationale, the market watches with interest to see if rents in Watford will indeed be set at £25 per sq.ft.
But will the upward pressure on rents continue?
We are currently experiencing the first quarter of 2022 with negative growth. Fuel costs are increasing, the cost of living is increasing and wage inflation e.g. HGV drivers (undervalued and underpaid for many years), build cost increases, interest rates are creeping up and the likely business rate increase are a few factors making a difference to profit margins across the sector.
On the other hand, there is a lack of industrial sites, every town in the region is surrounded by green belt, the planning process continues to be slow and difficult, there is a huge weight of money behind the sector with many new entrants, interest rates are still low, there is demand for quality buildings in accessible locations and companies cannot operate from home.
On balance enquiry levels have cooled since Easter. We are likely to experience a slower rate of rent inflation in the second half of the year.
The office market remains in something of a state of flux, although wild predications that we could be witnessing its death have been very wide off the mark. There has been a gradual, if modest uptick in enquiry levels, as companies come to terms with how they will occupy offices going forward, although in many cases this is still far from certain. There was talk of what are termed hub and spoke operations being set up whereby a Central London office would be supported by multiple suburban offices, but we have not seen significant evidence of this. Anecdotally however, we hear that serviced office centres may be providing the spokes to this model.
Hybrid working is very much becoming the norm, with employee time being split between office and working from home. We are also seeing a trend emerging of a high proportion of companies in the market for offices gravitating towards the best quality space. The thinking behind this is to create a truly attractive and appealing working environment to staff to encourage them back to the office, but also to appeal to new recruits and assist with staff retention.
This trend is particularly evident with larger requirements. Companies are also having to re-evaluate their workplace offering and culture, breakout areas and good coffee (we all have these at home) are not enough to tempt some employees back into the workplace. Creating an environment employees want to travel to is key.
An example of a recent relocation demonstrating this trend was Teaching Personnel’s move from somewhat antiquated offices in a peripheral Welwyn Garden City location to Wallace House on Shire Park, where a comprehensive refurbishment has just been completed. Negotiations were very constructive and included agreement to the Landlord providing secure bike storage.
We also find that there is a broad preference for in town space over out of town, with certain notable exceptions. This is due to the generally more complete package that in town offers to staff, in terms of a combination of public transport, leisure, shopping and eating facilities. As with the quality of the offices, availability of local facilities is key to maximising what might be termed the workplace experience for staff, who are a company’s most valuable asset.
This year we pledged to support a wide range of charitable causes. Since we haven’t nominated a specific charity, we intend to create as many opportunities for bf employee volunteers to take part in, whether it be volunteering, raising funds or arranging collections in and around the communities we live and work in.
Corporate business partnerships
In March 2022 we arranged an office collection for the Luton Foodbank who are always in need of food donations but especially monetary donations, like most charities fundraising really slowed down during the pandemic. If you are interested in supporting them information regarding all types of donations can be found here.
Saawan Jethwa has joined our Property Management team as a Client Accountant, he has over 5 years’ experience working within the property management industry, for both commercial and residential sites.
George Radford has joined our Retail Agency and will be based at our London office. George studied Real Estate at Oxford Brookes, followed by a Graduate Surveyor role licensing dark kitchens to restaurant brands. Initially he will be assisting with a number of our disposals for various clients plus some acquisition work too.
Welcome to the team Saawan and George!
Tim Howlings has been promoted to Partner. Since joining in 2012 and becoming fully qualified in 2015, he has established himself as an invaluable member of the Office & Industrial agency team whilst also working across the valuation and professional services platforms.
Felix Sharman passed his RICS APC in February and is now a Chartered Surveyor. He joined us on our graduate programme in 2018, during his time with us he has gained experience in Commercial Agency, Landlord & Tenant and Valuation. He’ll continue to work in the Office & Industrial Agency Team.
Some good news to share regarding the Watford Office market. GNR8 Watford– 49 Clarendon road is the perfect example of the impact a comprehensive refurbishment has attracting new tenants. Since Aug 2020, 6 deals have completed, 90% of which were let by our team with rents having risen about 9% over the period, which reflects the impact of the refurbishment and new amenities including, lounge style reception, bike racks and showers particularly key in the current selective market.
The total space let is 11,948 sq ft. New tenants include LILY & ROO LTD, Anker UK Ltd, FIEVEL HEALTHCARE LIMITED (moved in and then expanded in the building, comprising 2 deals), Parasol Homes, and AS24.
Only 1 suite remains on the second floor, floor plan details can be found here.
Contact Peter or Graham for more information.
The industrial logistics sector across the country has recorded another bumper year. Investor demand remains particular high with a weight of money available for investment in key locations across our region. The supply of good quality stock remains low and occupancy levels are high, this is resulting in many occupiers are getting a shock when it comes to their rent review.
Take up of industrial space in Watford was up on 2020 at 204,247 sq.ft, a 58,000 sq.ft up tick on the previous year. This was across 39 transactions which, again, out performs 2020. While this would suggest growth in demand and supply, in truth, the demand was always there and it is still outstripping supply with vacancy levels at record lows across the region.
The largest transaction was the 29,000 sq.ft letting at Greatham Road Industrial Estate which was the scene of last years’ largest letting on the adjoining space. All this estate is now let.
Top rents continue to climb with headline levels consistently at circa £17 psf for the best space sub 10,000 sq.ft.
The total take up for the year was 303,263 sq.ft across 19 transactions. The largest of which was the completion of DC1 Prologis Park 150,923 sq.ft to a datacentre operator. The remaining 50% of the take up was across 18 transactions. Stock levels and unit size have been barriers to further success in this highly sought-after location.
At the end of the year Prologis took PC of DC234, this property is the largest and highest specified logistics unit built in Hemel Hempstead for 15 years. Stock levels remain low and rents have moved on again as a consequence circa £14.00psf. Landlords are also holding out for longer lease terms without breaks.
Total take up for Welwyn Garden City in 2021 fell just short of 2020, with a little under 105,000 sq.ft of space being let across 13 transactions. Interestingly nearly 75% of this was attributable to a single letting, namely the first deal at A1 Connect, Ashfords scheme on the eastern outskirts of the town, where local company PW Gates took the unit to enable them to relocate from an outdated town centre site.
Stripping this transaction out of the figures shows that with one exception, all transactions have involved units of less than 3,500 sq.ft, proving that the smaller end of the market is in rude health, with rents of c£15.00psf being comfortably achieved.
The lack of more sizeable lettings is wholly due to lack of available stock, with companies having to look further afield to towns with a more ready supply, with St Albans in particular benefitting in this regard.
2021 saw a huge increase in letting activity, with a little over 255,000 sq.ft of space transacted, representing a three-fold increase over 2020 figures. Included in this figure is the letting of Unit 7, Ventura Park, a building of c87,000 sq.ft which skews the figures slightly, but even ignoring this, 2021 was an excellent year. A total of 13 lettings were completed, meaning an average deal size of 19,700, or if one excludes the 87k unit, then this drops to 14,000 sq.ft, still quite sizeable compared to historical trends.
The North Orbital Commercial Park saw a further 4 lettings in 2021, resulting in the estate achieving 100% occupation, something that it has struggled to achieve for a good many years. Top rent for the year was achieved at 10 The Dencora Centre, where Easy Bathrooms took a 3,900 sq.ft unit at a rent of close to £17.00psf, admittedly for a trade counter type use. The former ATS unit in Lyon Way, a building of c6,200 sq.ft was let to Herts Garden Rooms at £16.00psf, the Landlord having bought the unit from ATS earlier in the year for letting purposes.
Firethorn Trust are close to completing their second speculative scheme in the UK. The scheme comprises 8 units ranging in size from 14,140 Sq.ft to 123,490 Sq.ft. Practical Completion will be between now and end February 2022. The park presents an excellent opportunity to secure a unit within easy distance of junction 11a of the M1 motorway at a significant discount to locations further south. All units on the scheme benefit from excellent eaves height and large secure yards. We are pleased to report that interest in this scheme is very good and the units are going under offer, so please watch this space for further announcements. >
Acting on behalf of Wrenbridge & Bridges Fund Management, we are pleased to announce that planning has been secured for 3 units on North Road, Stevenage. Unit 2, 106,531Sq.ft is pre-let prior to construction commencing so the units are going fast! Unit 1, 73,593 Sq.ft and Unit 3, 25,736 Sq.ft remain available. We are also pleased to report that due to an additional land purchase Click, Stevenage will shortly be a 4 unit scheme subject to planning, further details to be announced. >
Hemel Hempstead is located only 27 miles north west of Central London on junction 8 of the M1 which is only a mile or so from DC234. The new logistics unit of 234,971 Sq.ft has reached practical completion and the unit is the highest specified and largest unit built in Hemel Hempstead for the last 15 years. The property occupies a prominent position on the corner of Maylands Avenue and Breakspear Way with access through the established Prologis Park. Prologis continues to evolve their specification with the unit benefitting from additional external areas for staff and glazing between the offices and warehouse space. The unit is ideally placed to service the Greater London markets as demonstrated by the occupiers who have already made Prologis Park their home on the southern M1 corridor. >
Following the success of phase 1 let to MBS, as a film studio and Global Infusion Group TritaxSymmetry are now on site building the second and final phase with completion due end May 2022.
Phase 2 has already seen early success with Pangea Laboratories signing a pre-let of Unit 4, 92,000 Sq.ft, the company are relocating from St Albans and during the negotiations have increased the office content to meet with their requirements. Unit 5 is 184,000 Sq.ft and Unit 6 is 115,000 Sq.ft are also to be delivered in this phase. >
Following the recent purchase of Gatehouse Close by Marchmont Investment Management planning is currently being worked up for a 5 unit scheme totalling 188,000 Sq.ft on 9 acres. Units range in size from 22,715 Sq.ft to 58, 850 Sq.ft and units can be combined. Further details and timing will be available on receipt of planning consent. >
The work from home message at various points during 2021 clearly had a huge impact on the office market. However the stats speak for themselves, it was not all doom and gloom last year. The market adapted to the changes in legislation and employer and employee sentiment.
Take up for 2021 was 177,951 sq.ft across 22 transactions. Whilst it amounts to a 68% increase on amount of sq.ft let on the previous year – and the best since 2018, the number of transactions was only marginally more and it is still not quite up to the ten year average which stands at 207,318 sq.ft.
Grade A rents in Watford have continued to grow with the letting to ENRA at HYDE, 38 Clarendon Road resulting in a new headline rent of £37 per sq.ft. The largest transaction during 2021 was the letting to Skanska who took 67,000 sq.ft of tenant space at Leavesden Park.
Watford continues to be an attractive hub for the surrounding regions with larger occupiers coming from Borehamwood, Maple Cross, Radlett and others. The flight to quality still remains with HYDE bringing new headlines rents and Croxley Park also demonstrating growth on the park. While Grade A space remains scarce around the region, we do expect this to change in the near future, but it is unlikely to affect rents negatively with further growth predicted on headline rental levels.
Welwyn Garden City
Unfortunately 2021 was again a quiet year for office lettings in Welwyn Garden City with take up of only a little over 18,000 sq.ft, although this still represented a significant improvement on 2020’s truly poor letting figures, when the initial effects of the pandemic largely shut down the market for some months. Interestingly the average size of the individual lettings is respectable at a little over 3,600 sq.ft, although with only 5 notable transactions, extrapolating trends is risky at best.
On a positive note, all of the transactions involved tenants new to Welwyn Garden City, with the towns major occupiers not having been active in the market. It will be very interesting to see how Buildings 4,5 and 6 at Trident Place on The Hatfield Business Park are received by the market, following EE’s departure. The total space on offer here amounts to a little over 155,000 sq.ft and as such does offer a product that in terms of size is all but non-existent in the north M25 market.
Total office take-up in St Albans was close to 43,000 sq.ft, almost double 2020’s figure, across 7 transactions. Grade A headline rents have shown significant rises after a lack of activity in this sector due to the lack of supply.
£38.50psf has now reportedly been achieved at Legal & General and Canmoor’s scheme at 10 Bricket Road where a comprehensive refurbishment and re-configuration of the building is nearing completion, with an additional floor having been added. Aecom, a long time St Albans’ resident, have taken the ground and first floors. At 45 Grosvenor Road, BEAR Nibbles, a fast growing European food company, advised by Brasier Freeth took a little over 14,000 sq.ft on the second floor which will serve as their new UK HQ.
2022 Key office instructions
Hyde is one of the landmark buildings in Watford. The accommodation is situated within a spectacular corporate office building offering from 3,184 up to 50,107 sq.ft office space. Hyde has been refurbished to a high standard, the specification includes 4 pipe fan coil air-conditioning, full access raised floors and suspended ceilings with LED lighting.
New amenities include a communal sun terrace with pergola and seating, an atrium breakout space & coffee point and 72 new cycle storage points & changing facilities. >
The Dock, Kings Langley
Set alongside the Grand Union Canal, The Dock is only 100m from Kings Langley station (Euston 27 minutes) and 1/2 mile from J20 on the M25. The building is offered on a leasehold basis as a whole 47,786 sq.ft or on a floor by floor basis from 8,238 sq.ft.
The building offers the best of both worlds to a modern occupier. It is situated in a highly accessible location making it easy for staff and visitors to access the building being only a 2 minute walk from Kings Langley Train Station, 3 minutes drive from Junction 20 of the M25 and only 6 minutes drive from the M1. >
Wallace House, Shire Park Welwyn
Wallace House is a 5,100 sq.ft 2-storey headquarters-style office building which has undergone a major Grade A refurbishment including an upgrade of air conditioning to brand new VRF system.
There has been a comprehensive modernisation of all common areas with the inclusion of modern shower facilities and break-out space to suit a variety of occupiers. >
We have moved
In October our Watford and Hemel based teams relocated to Kings Langley. The move was prompted by a desire for the Office & Industrial team to have even greater collaboration after a long 18 months of working from home. The new location has also given us much better access to our regional markets, speaking of which ee are very proud to share the news that our Regional Office & Industrial agency team came 3rd in the EG South East office rankings and 1st in the counties ranking for Hertfordshire for letting and occupational sales where the total space transacted was 175,978 Sq.ft.
The year has seen new record rents set for “A” grade offices in Watford and St Albans. These statistics are somewhat surprising when the office as a work tool seems to be equated with the spinning jenny.
The numbers are driven by businesses looking for;
Brasier Freeth have let just under 20,000 sq. ft to ENRA in the Hyde Clarendon Road at a new record rent, where the provision of bike racks, showers, barista style coffee offer, roof terraces, communal break out areas and a less corporate more homely environment were the clinching factor. ESG criteria (of the building and its owner) were also a factor. At the ASOS building in Leavesden where Skanska have taken 67,000 Sq.ft EV charging points were a key issue and in letting 4,200 Sq.ft to Schliech (a German owned toy company) we were able to reference amenity including, cafes, restaurants a gym and treatment rooms.
In contrast, the Hemel Hempstead office market has not fared so well. Take up to the end of Q3 2021 was a mere 31,171 Sq.ft in 11 transactions. Most were under 2,500 Sq.ft.
The largest transaction is the expansion of Intact Software into The Maylands Building, Maylands Avenue. It is our view that once the few deals in hand conclude the result for the year will be about 50% of the ten year average take up.
We are pleased to report continued good demand and confidence in the industrial sector. The main issue being the lack stock and new opportunities for sites. With rents marching across our region this has led to early occupier interest in the schemes which are on site or are coming forwards quickly with planning certainty.
One issue to contemplate for a landlord should they take the certainty during construction or keep their powder dry for PC when rents may have moved on again.
We are pleased to announce our appointment as leasing agents to the Atria shopping centre scheme, working alongside Global Mutual and Lunson Mitchenall.
Atria comprises circa 1.4m sq.ft of retail, leisure and catering accommodation, with 166 stores and 2770 car parking spaces. Major stores include M&S, Next, Apple, Zara, Uniqlo Hollister, H&M and Superdry.
Damian Sumner, Partner at Brasier Freeth commented: ‘We are absolutely delighted to have the opportunity to work on this exciting asset. We are joining the team at a really good time with so much ongoing leasing activity, based on a platform of international, national and local retailers that are all thriving.
This in turn is driving strong levels of demand both from new brands and a number of retailers wanting to upsize in the scheme. There will be announcements to follow on best in class fashion and leisure occupiers that have recently been secured for Atria.
With Brasier Freeth being traditionally based in Watford, we have seen the development of the scheme over a long period of time and as such, we are very much looking forward to being part of what comes next.
Steven Gray, European Retail Asset Management at Global Mutual commented: As consumers re-assess their lifestyle patterns, there are significant opportunities for Watford as a premium London satellite town. Investment in the town centre streetscape provides an improved environment for our customer base drawn from NW London, Hertfordshire and Buckinghamshire affluent catchments. We have chosen Brasier Freeth to work alongside Lunson Mitchenall based on the fact that the company have embedded knowledge and strong relationships both on a local and national basis.
Yet another Wingstop is opening, the latest location in Manchester Piccadilly will open on 24th November. Tom Powell at Metis acted for the landlord, and we have our 2nd deal with Metis about to exchange.
As retained agents, we have been working with Lemon Pepper Holdings Ltd t/a Wingstop to provide strategic property advice on their UK expansion. On the back of acquiring and opening their successful site in Kingston, we have advised them in securing prime sites in Manchester, Edinburgh, Wood Green and Brighton, with another 5 key sites under offer.
Manchester will be followed by St James Quarter Edinburgh, the new mixed use scheme developed by Nuveen. James Godfrey at Culverwells acted for Nuveen.
Although the pipeline is strong our clients are seeking a further 5–10 sites in 2022 and continued expansion in the coming years.
If you would like to discuss Wingstops requirements or have a suitable opportunity please contact Mark Segal 07764 247875 firstname.lastname@example.org
Requirements can be found here.
Another successful freehold acquisition for AVS, the fencing and landscaping supplies division of the Lawsons group. Formerly a DVSA Vehicle Testing Station extending to 2.2 acres, the site has been acquired for relocation and expansion of the Peterborough depot. This follows hard on the heels of earlier 2020 and 2021 acquisitions in Wokingham, Letchworth, Biggleswade, Ashford and Sidcup.
Further Leasehold and Freehold opportunities actively sought. Please contact Jeremy Hunting on 01923 205505.
Lawsons requirement flyer >
AVS requirement flyer >
Brasier Freeth will be working alongside Time Retail and also Sovereign Centros who are Asset Managers for the scheme owner, Frenchgate Limited Partnership.
Frenchgate Shopping Centre comprises circa 800,000 Sq. ft of retail and office accommodation, including 120 shops and 1,200 shopper car parking spaces. You can find the latest leasing brochure here.
Damian Sumner, Partner at Brasier Freeth commented: ‘We are absolutely delighted to have the opportunity to work on this exciting asset. There is significant investment planned for Doncaster over the next few years and with Frenchgate positioned at the very heart of the town centre, there is a great platform for growth.’
We hear this a lot. But if you believed everything you read in the National Press about the state of the UK retail market since the pandemic you would be wondering how our Retail & Leisure team is surviving.
More than 11,000 outlets permanently disappeared from our high streets, shopping centres and retail parks last year alone. Mostly chain outlets closed, we saw brands such as Debenhams, Top Shop, Miss Selfridge, Burton, Evans, Dorothy Perkins, Jaeger, Cath Kidson, J Crew, Oasis, Warehouse, TM Lewin close their doors forever. Footfall is down more than 30%.
The stats are true, and in some towns and cities the future may well be bleak and recovery prospects poor. In some areas rents are reducing, lease lengths are shorter and generally retail space is shrinking and alternative uses are being sought. In Central London footfall is still down 60/70% mid-week, but better at weekends and won’t bounce back until more office staff and tourists return.
An example of future growth plans with our client The Foschini group whose brands include Whistles and Phase Eight have a number of targets across the UK for it various brands.
The reality is that as well as letting and acquiring shops, our role has evolved; we are leading the way with our Lease Advisory Work and are extremely busy with high levels of activity. Where we have long standing relationships, we are actively helping our clients to steady their ships; we are entrenched with negotiating existing leases to help our retail clients to stay in locations but on reduced terms or helping our landlord clients to keep their tenants by supporting them.
We have all seen the strength of localism with so many working from home, if you are a landlord and have a vacant shop in a small town you may find more interest than pre pandemic but not necessarily from a branded operator. We have been inundated with enquiries from start-ups and independent operators wanting to open.
Our team have worked with some new clients over the past 12/18 months who are focussed on opening new units.
So……Retail bricks and mortar is not dead, it’s just different and will continue to evolve as will our role in shaping the future.
Huge congratulations to Russell Jerrard who acted for Fashion brand Vanilla, we are thrilled to announce they have opened their first standalone store at Bluewater Shopping Centre.
Vanilla’s 2 brands Blue Vanilla and Pink Vanilla aimed at 14-24 year olds will be stocked alongside an exclusive store only collection of shoes and accessories. The London based brand have previously only sold online shipping to the UK and internationally.
5 more locations are coming soon, we have ongoing requirements for our client so please contact Russell Jerrard 07785 388489
We are retained by Wingstop UK who urgently require further sites in London and in major cities across the UK. They currently trade from 14 locations and on track to open a further 6 restaurants by Q4 2021.
SITE AND TRADE REQUIREMENTS
Full requirements can be found here. Contact Mark Segal with suitable opportunities.
Having exchanged on Wingstop Kingston in March 2021 we are pleased to say the unit has been fitted out and will be opening on 14th July 2021.
As the changes in lockdown restrictions approach and the guidance for a gradual return for office based employees begins, our Office & Industrial team share their views.
Our team views
Smart companies will go through a period of change post COVID to ascertain what working practices are best. The only real way to engage with your staff is to instigate a period of trial and error. This is inevitably going to comprise hybrid working models with conditions.
The office should be a good experience both to retain and recruit the best talent. People will come in to genuinely do functions they are unable to do from home. The office will be a place for collaboration and a reflection of your brand.
Those who said the future of the office is dead are wrong, but we will see an ever-increasing flight to quality.
The workplace of tomorrow is one that is likely to have employees at the heart. Flexibility will be key to a dynamic environment. COVID has shown that a physical office is no longer the one of the key requisites to a successful business, therefore the onus will be on employers to make it a place where employees want to come and work.
This is not to say that the office is dead, far from it. I think we are now entering a transitional period for the office market whereby the majority of employees will be seeking some form of hybrid model of working practice going forward. Employees will want the amenities they are afforded at home to incentivise them to the office, whether it be break out space, a relaxed dress code or even flexibility around the hours they work.
COVID has opened a new method of working and those companies, and landlords, that can adapt the quickest to these needs are likely to see the benefits in both the long and short term. The office is about to get a new lease of life.
HYDE – Clarendon Road, Watford is great example of a fully refurbished 75,000 Sq.ft office building. The available accommodation has been refurbished to a high standard and the specification includes 4 pipe fan coil air-conditioning, full access raised floors and suspended ceilings with LG7 lighting.
Acting on behalf of ReAssure we let the entire 3rd floor and part of the second floor totalling approximately 20,000 sq.ft with a rent of £37 per sq.ft on a new 10 year lease subject to a tenant only break at the fifth year, Brasier Freeth acted jointly with BNP Paribas Real Estate.
The pandemic has certainly caused what can be fairly described as seismic changes to the way we have lived and worked over the last 12 months, although from the media’s perspective this has largely focussed on its effects on the retail and hospitality industries, being most obviously “visible”. Changes in office practices have perhaps been less newsworthy, but have nonetheless significant. In the early days, working from home was something of a novelty, but as time has marched on perceptions are changing.
Much comment has been made of the future need for significantly less office space, although anecdotally much of this comment came from business leaders with more than a passing interest in the prospect of potential rent savings. These thoughts perhaps overshadowed the practicalities of how a significant volume of the workforce could actually work from home, when home might be a bed-sit, not a sprawling house in the Home Counties with space for a home office, more typical of the business managers making decisions on working practices.
Working from home also means the possible introduction by stealth of opaque boundaries between work time and personal time, email traffic has begun to spread over a longer day and does the boss now expect an answer to an email sent at 8:00pm? should it even have been sent ? could the emails received out of hours have been sent by someone who took a couple of hours off during the day to take the dog for a walk and is now catching up? Working from home can also be lonely, with a feeling of isolation, and for many a physical boundary between the two aspects of their working day is welcomed, indeed for some actually trying to get into a work frame of mind from home surroundings is quite a challenge.
The office market has seen a year-long battle of stalled activity and lack of movement from occupiers of all shapes and sizes, enquiry patterns have shifted with precedence on locational & strict financial restrictions taking lead. I suspect we will see a shift towards offering office accommodation as a space to integrate and communicate, rather than a 5-day 9-5 requirement, in return allowing operators to lower their overall space requirements. We hope to see enquiry levels rise and a shift in movement patterns as occupiers start discussing their long term decisions regarding operational work hours / days and requirements on staff.
The service office sector certainly offered a notable pre-Covid early glimpse into what we may now expect the overall market to morph into pressing forward, with offerings of relaxed break out areas and compartmentalised rooms to allow teams to come together in characterful space rather than the traditional four walled board room and banks of desks.
I suspect those who have operated under the WFH banner the past 12 months are relishing the return to the office on a flexi basis but may not be ready for full submergence just yet!
Not for everybody but for many. and in particular people working in a team environment having an office base is good for business.
The return to the office should be encouraged. Having the flexibility to work from home is nice but I wonder what this will do for productivity in the longer term.
The genie, who I think are mostly the more mature variety with spare rooms and nice gardens, is out of the bottle and I doubt it can be persuaded to go wholly back in.
Working from home over the last year has adversely affected the younger generation. My millennial son who spends virtually the whole day looking at a screen while working from his bedroom in Stoke Newington is desperate to get back to the office, so much so he is actively looking to move jobs. I am sure he is not alone.
Employers should encourage the return to the office by making it a better environment, with excellent facilities but ideally also with a critical mass of people to facilitate social interaction and promoting perhaps some out of office activities again so people can develop the friendships and contacts that can last a lifetime.
It might also mean they want to stay in a job rather than move on and have to be replaced.
I think the future of the office is positive as I do believe the attraction for working from home on your own has worn off for a lot of people. Having a dedicated work space with no distractions at home is difficult, as is training staff.
Moving forward I think there will be a balance of office and home working. Some companies have already announced what they are proposing and I am sure others will follow as it will become a factor in recruitment of staff. Quality I feel will be a key point for the future and a pint after work with colleagues when working from home is not easy! It’s not the same on a Team’s call. I think dress code will be a little more relaxed, and I think the tie is now probably dead for most business environments.
Our new London office is open. The Retail & Leisure team are now based at 53 Duke Street W1. If we aren’t at our desks we are most likely to be found wandering around Selfridges opposite.
After over a year of working from home, the new office is such a welcome space for us to see each other again and enjoy the buzz of London.
Shopping Centres have seen an intensification of challenges that we were facing some time prior to the pandemic. The show will definitely go on, with fewer but fitter operators occupying less but better quality floor space.
Working with various shopping centre owners, we spent a significant amount during the first lockdown helping to understand the needs of occupiers. In a lot of cases, we worked through various restructuring initiatives in an attempt to try to ‘share the pain’ of the pandemic. It is an easy line to say out loud, but is clearly underpinned by jobs and livelihoods being at stake.
It is clear that resolutions on outstanding arrears will continue to be a major feature of negotiations well into 2021, whether it be by way of compromise, via regears and staggered rent repayments or in a worst-case scenario, head in the sand.
CVA’s will sadly continue to hit shopping centres, particularly in the fashion sector which has been significantly impacted with over supply, based on too many operators in too many stores alongside a major softening of consumer demand.
We are excited to see a changing of the guard, with a new breed of occupiers emerging. Independent and local operators will eventually evolve into national success stories. They key for shopping centre owners is to provide them with the flexibility of space in which to grow.
Our shopping centre leasing instructions are seeing strong demand for occupiers across a range of uses. Whilst there are reasons to be positive, a greater amount of expertise and resource will be required from leasing agents. Identifying and capturing independent occupiers, nurturing their interest often with a good deal of hand holding to get transactions across the line, all takes time.
Some of the projects we are involved with have taken us into new territories, it has been genuinely refreshing to see first hand the level of entrepreneurial activity that is alive and kicking throughout the UK.
At Barons Quay, Northwich the leasing team have been responsible for securing deals with The Coffee House, Ice Cream Farm, BEAR, Geek Retreat and Puddle Ducks. Each represents ‘best in class’ providing the local catchment with a different but cohesive reason to visit.
Sitting alongside more established fashion names, these occupiers present a real point of difference for the scheme, giving customers a very clear reason to come back time and time again for the shared experience.
At our schemes in Harlow and Basildon, we are leasing to non-retail uses including The Department of Work & Pensions and the NHS. We are generally seeing an increase in community and wellbeing uses as an obvious response to the effects of pandemic.
The real challenge for owners is to fill large space left behind by the demise of some of the mid-market fashion operators. Traditional grid lines make it difficult to split some of the units and as such the flexibility of space will be increasingly important in future design. The role of the leasing agent has to be more than just space filling, asset management will be a skill set in increased demand with the ability to plot out a clear strategy to meet future demand. In a lot of cases this will ultimately involve reducing down supply.
Flexibility and affordability were key drivers of negotiations well before the pandemic. There is no doubt that we will continue to see an increased move towards shorter lease and turnover orientated transactions. This however has to be a two-way street, requiring collaboration between landlord and tenant, based on clear lines of communication and transparency.
Repurposing is the magic word that everyone is talking about at the moment and there is no doubt that retail stock will be circled by a whole host of alternative uses both commercial and residential, mainstream and specialist. All of that said, there is only a limited proportion of retail floor space that will lend itself to a viable refurbishment or alternative uses.
A number of repurposing strategies are focused on replacing traditional department stores as anchors to shopping centres. The size of department stores at least increases the viability of redevelopment and provides flexibility for a range of uses whether the space is split horizontally or vertically.
The redevelopment of the Eastgate Shopping Centre
We are acting for Infrared Capital Partners/Sovereign Centros who have submitted a planning application for the redevelopment of Eastgate Shopping Centre, Basildon as a pivotal part of the wider regeneration of the town centre.
Part of the proposals involve demolition of Debenhams replaced with new high rise residential blocks, with retail/leisure uses at ground/first floor.
Take up was 105,303 sq.ft across 17 transactions, a 53% increase on 2019 but still down on the 5 year average of circa 225,000 sq.ft.
Grade A rents in Watford are currently at £36.50 psf, a 12.3% increase on 2019 with an average size of 6,194 sq.ft. The largest transaction was 28,083 sq.ft to PWC at 40 Clarendon Road.
Grade A office availability is scarce. 40 Clarendon Road has illustrated that there is demand for a good quality office product. All but one floor is let with the majority completing during lockdown. There will likely be an increase in office space coming to the market during 2021 however a large proportion will be tenant space which may offer something different to the market in terms of lease flexibility but is unlikely to appeal to the prime market. Rents have continued to grow as predicted however we are seeing a drift in incentives being offered to counter the current uncertainty around occupation.
The total takeup was low, at 51,089 sq.ft in 7 transactions. This is less than 50% of the 10 year average take up. Grade A rents in Hemel remain static at £27.50 psf. Incentives have increased reflecting the lack of confidence fueled by a third lockdown.
The largest transaction was GAMA Healthcare 19,606 sq.ft, at The Maylands Building who relocated from Watford, and the second largest was Mothercare who also relocated from Watford in search of value.
There is currently over 300,000 sq.ft of available office stock on the market and we anticipate this figure will increase during 2021.
Welwyn Garden City
2020 was a poor year for the Welwyn Garden City office market, with total take up of only 2,075 sq.ft in 2 transactions, and no Grade A activity. The highest rent achieved was £24.00psf at Rosanne House, a refurbished Grade B office building in the town centre.
A lack of acquisition activity from the towns’ largest office occupiers, Tesco and Ocado undoubtedly had an adverse effect on the market as well as a lack of churn resulting from office occupiers being forcibly displaced by permitted development of office buildings. This has turned off what has been a steady stream of office relocations.
Rents in the order of £25.00psf are still being guided on Grade A stock, with the market being polarised between traditional in town, and out of town on Shire Park and Hatfield Business Park, where significant voids remain.
Total take up was 23,961 sq.ft in11 transactions, with the average deal size being 2,180 sq.ft. There was no true Grade A activity, the highest rent achieved being £32.50 psf at Trident House in Victoria Street, a good quality Grade B building. The almost complete absence of any true Grade A space does not tell the true story of where rents should lie for the best space.
The largest deal was the letting of 5,700 sq.ft to Skechers at Centrium, adding to their existing holding, a welcome vote of confidence in the local market.
Taking all factors into consideration, take up figures for 2020 were respectable, with a lack of stock of any significant size or quality simply meaning that larger transactions could not happen.
The total take up was 140,472 sq.ft in 16 transactions with the average transaction size of 8,780 sq.ft reflecting the lack of available larger units. The largest transaction was 22,408 sq.ft; the assignment of Unit E Maylands Point to IIAA. The company were in a competitive situation for the building and a premium was secured for the lease.
Spring Park, Maylands Avenue has seen a number of lettings this year, with a guide rent of £12.50 per sq.ft per annum exc. Only Unit 1, 7,100 sq.ft remains available. And, now only one new unit remains available at Unit 5 Eastman Way, Prologis Park (13,066 sq.ft). There is a general lack of freehold transactions across the market.
DC1 (150,000 sq.ft) Prologis Park, a turnkey datacentre project will complete in February 2021. Prologis Park’s DC234 (233,860 sq.ft) is not on site with completion due Q3 2021, this high quality logistics unit is a much needed product in the North M25 / Southern M1 corridor.
Welwyn Garden City
The total take up for the year was 121,650 sq.ft in 11 transactions, with the largest deal being the letting of Belgrave House on Hatfield Business Park to Alstom, a unit of 45,840 sq.ft.
The highest rent achieved was £11.95psf, paid by Borough Box Ltd, at Quadrant Park. This matches the highest rent achieved psf in 2019.
Welwyn continues to see instances of lettings of larger units in part due to greater stock levels of this type of product in the town, and has also seen it’s first instance of speculative development for some years with construction beginning at A1 Connect in Cole Green Lane. This scheme comprises 3 units totaling 120,000 sq.ft, with the largest, a detached unit of 72,500 sq.ft having already been pre-let to PW Gates Ltd.
This transaction did not however fall into 2020, so is not included in the years’ figures.
The total take up for the year was 75,046 sq.ft in 9 transactions, with supply remaining wholly dependent on churn of existing stock. No new development has occurred, not due to lack of demand, but simply as a result of scarce development opportunities.
The average deal size was 6,800 sq.ft, with the largest transaction being the letting of Unit D at Ventura Park to Express Logistics (c16,000 sq.ft). The highest rent achieved was £16.50psf at the letting of 5 The Dencora Centre, a building of c2,880 sq.ft.
The North Orbital Commercial Park saw two lettings, both achieving close to £11.00psf, a new record for this estate. As a result, quoting rents on the remaining units have now been nudged up to £11.75psf.
The total take up was 145,329 sq.ft in 28 transactions, with the average transaction size of 5,190 sq.ft reflecting the lack of available larger units in the locality. Take up and transaction levels were lower than previous years, however this is more reflective of low supply levels as demand and growth in the industrial market ontinues to increase.
The largest transaction was 28,550 sq.ft on Greatham Road, Industrial Estate, however interestingly this was not to an industrial user but an occupier from the leisure industry.
Top rents in the region are circa £15 per sq.ft, typically for smaller modern units of sub 5,000 sq.ft.
In-line with Government guidelines, surveyors and other professionals in the property and construction industry are able to leave their homes for work purposes, where it is necessary to do their jobs. We have adapted our day-to-day practises to ensure we are working in a safe and Covid secure way. All Brasier Freeth colleagues are working from home when not carrying an inspection, viewing or valuation.
With the above in mind, the Brasier Freeth policy for employees during this latest lockdown is as follows:
Whilst on-site the below protocol is to be adhered to:
Retail & Leisure Agency team
Q: I am a tenant and have a shop lease; do I have to pay the rent?
A: Under a lease obligation you are obliged to pay, however there may be ways of restructuring the terms of your lease agreement, to provide financial assistance. One of our surveyors would need to review a copy of your lease to advise on how best to strategically approach the Landlord. The ’’Government Code of Practiseor commercial property relationships can be found here.
Q: I am a Landlord of a retail unit and have a Tenant who is not paying the rent, what can I do?
A: The remedies for Landlords have been limited to a large degree due to the Government moratorium on evicting Tenants. The relationship between a Landlord and Tenant is essential in developing an open dialogue to discuss the issues arising from non-payment of rent. Conversations we have been involved with have tended to centre around the question of whether payment arrangements can be structured in partnership, in order to share the financial burden arising from current market conditions.
Each situation will be different depending on individual circumstances, particularly in relation to lending/funding facilities. There is no doubt however that real benefits often come from open and transparent conversations.
Q: Are Business Rates payable at the moment?
A: At present it you are a tenant and would normally be open for business if it were not for the National lockdown, then business rates are not payable for the 12 months from the 1st April 2020 to 31st March 2021. This relief has been put in place by the Government to support business in the UK. It applies to retail, hospitality or leisure properties. We are awaiting news on whether this will be extended beyond the end March 2021.
Some properties are also eligible for discounts from their local Council, whilst others are exempt. The Business rates revaluation for 2021 has also now been postponed. Please contact us for further details.
Q: I am thinking of taking on a new lease this year, what protection is available in the event of future lockdowns, which prevent me from being able to trade?
A: There is no statutory law that has been passed to safeguard against future lockdowns and as such any agreement would be down to mutual negotiations with your Landlord.
We are seeing that Pandemic clauses are becoming more common in leases, based on a myriad of wording including drafting on local Council regulations and also social distancing. Some clauses cover named pandemics such as Covid19 or SARS, whereas other are more generic. We have been involved with transactions based on limitations to specific time periods in any one calendar year. In some circumstances, the base rent switch to turnover provisions to deal with take away, click & collect and delivery provisions. Pandemic clauses may well need to drafted bespoke to individual organisations and specific circumstances. As a result, strong working relationship between the respective parties is essential, with a thorough understanding of the business model.
Please contact Anthony Appleby to discuss any of the above or similar questions you may have.
Office & Industrial Agency team
Q: Can I view a commercial property at the moment?
A: Yes, provided sensible precautions are taken including social distancing and the wearing of masks. Access to premises may however be restricted by some vendors/lessors or occupiers to protect their business and health. These restrictions must be respected under current circumstances but video and 3D walkthroughs may provide another means of getting an idea of how a property works. Please refer to our protocol, outlined at the top of this page.
Q: Will I get a better deal due to Covid19?
A: This will depend on the type of property, the tenure and the location. Some sectors (such as logistics) have barely missed a beat since the pandemic occurred whilst others have stagnated but have not seen drastic changes in terms as yet. Some adjustment to reflect difficulty in occupying due to lockdown is possible, but this is likely to be time limited and insubstantial in the Office & Industrial sectors. Once the pandemic has lifted and the new economic and property demand landscape is evident, we may see an acknowledgment that terms need adjustment but this is likely to vary by tenure, sector and location.
Q: Can I get a rent concession from my Landlord because of lockdown?
A: The direct impact on business operation of the pandemic in the Office & Industrial sectors has been limited and, in some instances, even positive. Because use of offices and warehouse premises is not prohibited by law (and never has been during the pandemic) Landlords have been slow or reluctant to consider giving rent holidays but have in some instances changed payment frequency or deferred rent payments to help tenants with cash flow. This is dependent on the circumstances of the Tenant and the Landlord (who may have their own cash flow issues). Some circumstances may mean a Landlord can and will give a rent concession so it’s getting worth in touch with Brasier Freeth to evaluate your options.
Please contact Peter Brown to discuss any of the above or similar questions you may have.
Building Surveying team
Q: Has COVID affected your turn around times for reports?
No, it hasn’t. We are still issuing our reports within 5 working days of the inspection date.
Q: Can you still survey our properties during lockdown?
A: Yes, we can. We take the necessary precautions and wearing face coverings, wash or sanitise our hands, and we do request the property is vacant or the occupants are in a separate room while we conduct our survey. Please refer to our protocol, outlined at the top of this page.
Q: Has COVID19 caused delays in construction work?
A: Construction workers are still able to work during lockdown. The delays we have experienced have been with the supply of materials rather than the workers. However, with advanced planning these delays can be mitigated.
Q: Can the Landlord still claim for Dilapidations even though we are suffering a pandemic.
A: Yes, the Landlord can. The resolution of the Dilapidations claim may be different, as a result of Covid19, and you should still seek expert advice to resolve your Dilapidations Claim.
Please contact Paul Raitt to discuss any of the above or similar questions you may have.
Q: Are the Banks still lending?
A: Yes, we continue to receive instructions from a wide variety of Banks and other lending institutions.
Q: Are you currently able to undertake internal inspections?
A: Yes, but ideally unaccompanied and with premises vacant. Valuers will wear appropriate PPE during all inspections. Please refer to our protocol, outlined at the top of this page.
Please contact Steve Oakey to discuss any of the above or similar questions you may have.
Our client Tossed has a new London requirement. Tossed makes healthy and delicious food that is accessible through distanced, tech-led solutions; be that online, in-store, delivery or automated retail.
With a different workforce landscape emerging in 2021, a strategy of selecting stores in top City hotspots is the current objective.
Having closed a seed funding of £1.0m led by their management, BNW Food Limited t/a Tossed (“BNW”) is a well-funded entity with a clean balance sheet.
600 – 1,800 sq ft
City of London
Tottenham Court Road
High Street Kensington
Contact Mark with suitable opportunities.
We are delighted with the new Westside video showcasing, an established office building of 185,000 sq ft set in the heart of Apsley. The building is set in a mature landscaped environment alongside the Grand Union Canal and close to Apsley mainline rail. The last remaining suite is 6,923sq.ft with 27 on site car parking spaces, cycle parking and an on-site café.
Link to full details can be found here
Contact Claire or Trevor
The office isn’t over, it’s just going to be different.
Since the end of lockdown 1.0 the office market has been surprising, to the extent that a number of transactions have taken place where the take up in Watford will exceed the total for 2019 by the end this year. Activity has been more muted in Hemel Hempstead, but transactions of reasonable scale have occurred in the wider area. For example, 35,000 sq. ft. in two transaction since May.
St Albans has seen less activity, but this is a market with lower levels of stock anyway. The rumoured large relocation in progress in St Albans is apparently looking less solid and it is possible that the BF letting and re-gear to Skechers at Centrium in Holywell Hill, will be this years’ highlight.
It would however be fair to say that this demand across the wider region has been driven by factors in play prior to the virus, including lease events, corporate purchases and consolidation that even the virus could not halt. Where this has not been the case, the companies involved have in some cases been health related beneficiaries of the pandemic.
Surprisingly, rents in a headline sense have stayed firm with rent fees being in some cases adjusted modestly to account for possible deferred occupation.
If that’s the story so far what does the future look like?
The conjecture in the wider market suggests a variety of outcomes, some apocalyptic (the end of the office) and some even beneficial to locations like our core towns (the hub and spokes model) but the truth is that no one really knows at this point what type or scale of office they will need and where it’s likely to be required.
We can assume that there will be a greater acceptance that working from home is possible and that it is not a licence for loafing. Interestingly, the younger generation are, in my experience, the most likely to be disciplined about work outside the office. Certainly, a number of companies have indicated they do not expect attendance 9-5, 5 days a week, whatever the pandemic outcome.
That said, a lot of people particularly those who are starting out their career or whose home environment is cramped with little or no outside space, have not enjoyed working from home and have realised the benefits of the office environment in terms of mental well-being, professional and career development as well as the social side (how many readers met their partner at or through work?).
What seems likely is that offices will need to be attractive enough to make them worth travelling to and, post covid, we may see more need for social space in and around offices. Touch down facilities that don’t involve travel to an office but an office environment may become more widely used (provided we can have that degree of interaction going forward.)
Office hours are also likely to be more fluid as those who can, will choose to travel outside peak time. Presenteeism will most likely be less important, but the office isn’t over, it’s just going to be different.
The clock cannot be turned back, delivery demands and expectations of customers will only grow greater.
The effect of the pandemic on the warehouse sector has to some extent crept under the public’s radar, unless you happen to be an agent or developer, or an occupier in the market for such space.
The inexorable rise of e-commerce and the need to efficiently store and deliver products has already created an almost insatiable demand for warehousing on an unprecedented scale, and COVID has resulted in a further dramatic increase in online demand as customers are faced with little option but to buy certain goods in this fashion, particularly food, a sector where inroads have tended to be slower.
Over time warehouses have grown larger as occupiers and third party distributors delivery methods and efficiencies have evolved, with COVID arguably bringing forward changes in retailing that might otherwise have taken some years to adapt, albeit in a dramatic and wholly unexpected fashion.
The clock cannot be turned back and the delivery demands and expectations of customers will only grow ever greater. Many of today’s millennials would be shocked by mail order delivery timelines back in the day, “allow 28 days for delivery”!
What this does mean for development opportunities.
The first question is, will it suit a distribution scheme and how large can a building be constructed? Economies of scale naturally coming into play. And, as a result smaller requirements are frequently not catered for by new schemes, and in the vast majority of instances units are only offered for rent. Britain is often described as a nation of home owners and at the smaller end of the market, broadly sub 5,000sqft, this also rings true with commercial occupiers, many of whom are owned by entrepreneurs who yearn to buy their own premises, but simply don’t have the options to do so.
With consistently low interest rates, borrowing remains relatively cheap for those with a financial track record plus a meaningful deposit and, when opportunities arise, we find that freehold factory/warehouse space almost sells itself. This might seem a little strange in the current climate, but with a freehold an occupier is largely in control of their destiny, ultimately giving greater flexibility. Not having a landlord to answer to is hugely appealing, plus building improvements over time are to the benefit of the owner and there is no risk of having to reinstate alterations.
We have concluded a number of freehold sales recently, with COVID not proving to be a factor and have most recently completed a sale on a unit in Kings Langley at a capital figure of c£230.00psf.
From one extreme, to the other. At the very smallest end of the market we experienced strong demand for small units of less than 1,000sqft throughout 2020. This market is largely ignored by developers simply due to lack of economies of scale in terms of construction, and a perception that small lettings can be a handful to manage, so product is in short supply. We have a couple of estates in Hatfield and Watford, where we have completed 7 lettings this year at rents as high as £20.00psf and quite literally have a queue of applicants eager to hear if and when the next unit might be available on the market.
Particular casualties of COVID have been businesses in the hospitality and events sectors. Both having noticeable representation in our market, given proximity to London. Whilst government support may have helped, one wonders if some may seek to offload property.
In a similar vein, an unknown number of occupiers may only be continuing to trade due to Government support and rent holidays, and then may cease to be viable, potentially releasing space to the market. However for the time being, there remains a tight supply pipeline, both new build and churn, which is resulting in rents holding up, much to the surprise of many enquiries who assume the market will be apocalyptic, with cut price deals on offer.
Whether this demand for factory/warehouse space across all sizes will continue is open to debate, but it seems likely. One thing is certain however, it is always going to be a challenge to carry out a volume storage or manufacturing process working from home, so the sector looks safe for the time being.
If you are searching for a new office or industrial unit to rent/purchase, or you need to review and negotiate a new lease or you are looking at starting a career in surveying, Tim one of our chartered Surveyors can help answers some questions you might have, he explains what it means to be a Surveyor specialising in office and industrial.
A surveyor is a wide-ranging term that can apply to anyone who examines or investigates something. More specifically, and in relation to commercial property, it is a multi-faceted industry covering a wide range of professions from more traditional views of what surveying are, i.e. building surveying, to more niche areas of the sector such as planning / development and Valuation.
I am what’s known as a general practice-chartered surveyor which is a broad term, much like my role at Brasier Freeth. My key areas of expertise include the purchase, sale and leasing of commercial real estate, but in addition I am responsible for property investment, development appraisal and general lease advisory work which incorporate valuations of commercial property.
RICS stands for the Royal Institute of Chartered Surveyors. Founded in 1868 in London, the RICS are the governing body in the UK and recognised globally as one of the leading professional bodies which focus solely on the built and natural environment. We are a RICS accredited firm, this means clients who work with us can rest assured that are surveyors have a globally-recognised standard of surveying education.
There are many routes into becoming a Chartered Surveyor, all designed and assessed on your sector-specific skills, knowledge and experience. Practical training is done ‘on the job’ and there is no replacement for experience. The RICS, among others, run regular CPD conferences, workshops, seminars which not only help improve your knowledge base/skillset but can also be a good refresher for those who are already qualified. In addition, it is mandatory for all qualified surveyors to undertake a minimum amount of CPD training each year to ensure they are up to date with the latest changes in the sector.
Yes, we are uniquely placed within the market as the services we offer and clients we work with are considerably more extensive than other firms of a similar size. Our retail agency and building surveying services operate on a national level while the regional agency, valuation and professional teams have a far-reaching reputation on a local level which has seen us win multiple awards as testament, most recently having won the most active agent award in Hertfordshire for the thirteenth time in a row!
1.Get ahead – Commercial Property is an industry that moves fast, the earlier you start the process, the less likely you are to run into problems further down the line.
2.What are your business requirements & considerations – How much space do you require? Do you have a budget? Are there key dates by when you need to move? List all your requirements.
3.Think about your team needs – How do your staff travel to and from work? Do you need to be near amenities such as a town centre/public transport? What facilities do you need to offer your team on site?
4.Professional advice is vital – Chartered Surveyors have a wealth of knowledge and advice on a wide range of commercial property matters, their advice should be impartial and in your best interest. Seeking advice will save you time and money in the long run.
5.Do your own research – There are many online resources such as the RICS who recently released the ‘Code of Leasing Business Premises’ which contains useful information for tenants and landlords.
To search for Office & Industrial properties click here and for advice contact Tim Howlings.
Damian Sumner, partner at bf recently took part in a discussion about the future of the high street alongside Trevor Watson, Director at Davis Coffer Lyons and hosted by WiRP Chair Emma Vigus.
The changes we’re seeing haven’t sprung up overnight
The high street continues to face massive challenges in dealing with an increasing amount of surplus space owing to businesses closing their doors due to administration; move online or to out-of-town retail parks. Shoppers are increasingly drawn to the convenience of online shopping particularly in the face of rising car parking charges and localised congestion.
The recent pandemic has only exacerbated these issues, as Damian Sumner comments:
“It’s important to remember that the changes we’re seeing haven’t sprung up overnight because of coronavirus. We’ve been seeing change on the high street for a long time, it’s just that the current situation has dramatically accelerated this.”
The concept of the high street is tightly woven into the social fabric of our society
“Don’t throw the baby out with the bath water” is an adage pertinent to the future of the high street. The concept of the high street can’t simply be discarded, as it is tightly woven into the social fabric of our society – from the commercial property investments held in our pension funds, to playing an important role in our sense of community and well-being.
There is also a surprising link between physical space and online shopping, which continues to make high street store fronts a valuable asset for retailers – albeit not all of them. Beyond the more obvious click and collect services, brand awareness and PR, research has shown that if retailers don’t have physical space in a particular region, their online business suffers in those areas.
Mixed use spaces to live, work, and play will become increasingly important
Our high streets will continue to exist, just not as we know them, as Trevor Watson comments:
“The death of the high street is exaggerated. Mankind has had city centres for generations, and they will continue to be places for people to meet. However, we will see a shift away from tangible retail usage to other activities such as hospitality, members clubs, coffee shops and experiential leisure.”
Mixed use spaces to live, work, and play will become increasingly important to the survival of the high street – but collaboration will be fundamental to how well these spaces serve their communities. Unfortunately, there have been cases where attempts at creating mixed use spaces have favoured housing needs over those of commercial occupiers, and this has resulted in spaces which aren’t viable for retail and hospitality businesses. To truly succeed, there needs to be an element of localised collaboration that brings various professionals together – including developers and surveyors – to ensure the emerging spaces are truly mixed use and work effectively for everyone.
Some towns and cities are proactively adapting to the changing demands of the community. For example, residents in Basildon and Southampton will see a steady reduction in the amount of retail space, in favour of creating more housing. This is the approach more towns and cities need to adopt, to ensure their high streets change with the times – and don’t disappear.
We’re seeing a shake-up in how space is made available to retailers
It’s not just about the use of the space either, it comes down to how units are priced, the length of leases available, and how units are fitted out and how adaptable the spaces are. Many landlords have had to rethink how they offer their space to their potential clients in order to remain competitive, as Trevor Watson comments:
“Opportunities for pop ups now are huge, and I believe that pop-ups with rents based on turnover will be with us longer term. We’re also seeing more demand for fitted or partially fitted units, which are quick and easy to move into and repurpose, as the renting model shifts towards a more flexible approach. However, that doesn’t mean that fixed rents will disappear, as they are tightly linked to the investment community, and operators would prefer to pay a fixed rent if they are confident in their revenue stream and have a strong product and a good brand.”
There continues to be winners and losers in the ever-changing face of the high street
Conditions remain tough on the high street. There is no telling when social distancing measures will be revoked, or if the country will face a third lockdown. Beyond this, many retailers are also bracing themselves for the impact of Brexit and the removal of the rent moratorium, where no doubt some landlords will be calling in back payments and forcing many businesses to make tough decisions to ensure their survival.
However, as with all change, there’s opportunities too. Even in the midst of the pandemic, there are still “winners”. Damian Sumner highlighted several retailers who have performed strongly throughout the last 6 months. These included retailers in the DIY and home interiors sector who’ve benefited from high demand as homeowners used lock-down to improve their homes and casual wear brands who’ve cashed in on the declining demand for formal wear. Damian also highlighted those retails who have a diversified presence across the high street, out of town retail parks and garage forecourts, Costa Coffee being a great example.
We’re also seeing a shift towards localisation and more affordable rents, as Damian Sumner comments:
“We will see a re-basing of rents because of the collateral damage brought about by the pandemic and this will enable a new era of affordability which will create a great opportunity for businesses, who were previously priced out, to return to the high street”.
Trevor Watson highlighted regional variations in high street performance:
“Retailers who’ve been heavily reliant on commuter trading are going to see a very slow recovery, and perhaps never return to ‘normal’ based on the growing likelihood that people will commute just 3 days a week – instead of 5 – as things eventually normalise. By contrast, leisure travel will bounce back very quickly, and places such as the West End will recover far quicker. Equally, we’re seeing trends in the London ‘villages’, such as Clapham, being mobbed with consumers taking advantage of local hospitality offerings. In these areas in particular, high street rental rates are standing their ground and we’re seeing very little reduction in cost.”
The future is uncertain, but not as bleak as mainstream media outlets would have you believe, and once the dust settles, there will very likely be a yearning of people wanting to get back onto the high street – whatever shape that may take.
Written by Emma Vigus, Managing Director of mio
Our client greenrooms have a requirement for development sites in the South East, East Anglia, Leicestershire, East Midlands and Nottingham:
Full requirements can be found here
Please contact Ivan Everitt for more information.
The charity sector has been particularly badly affected this year, we are supporting homeless charity DENS to raise much needed funds. DENS supports people facing homelessness, poverty and social exclusion by providing temporary and short-term, emergency food provisions aswell as advice and support.
We have setup a paypal pool, money raised will be paid to DENS in time for Christmas.
Upon the instruction by Boots we have 33 Leasehold retail disposals available individually across the UK.
Please contact Anthony Appleby, Damian Sumner or Mark Segal for the full list of disposals. You can also search for all available properties on our website here.
We are pleased to share the news that we will be acting for Pirate.com who have big ambitions for 2021/2022. This is an incredibly exciting new use class for us.
Founders David Borrie and Mikey Hammerton were tired of practising in damp, dark rooms and thought that they could do something better for musicians without hitting them in the pocket: the result was the world’s first 24/7, self-service studio space. Key to the success of the company has been the innovative, tech-centred model; operating unique self-service studios to maximise availability and minimise operating costs, enabling them to offer a high quality product at ultra-competitive prices in a market where price points are especially sensitive.
Of the 400 studies worldwide and the 100,000+ customers who have used their facilities, the majority have no direct contact with Pirate staff: they book a studio slot on the website, and receive access codes. These codes grant time-limited access to the building and rooms they have reserved, and at the end of their session they simply leave the room for the next customer.
“In a world of decreasing record revenue and with a shrinking choice of live venues to play in, we are utilising technology to put money back in artists’ pockets. Like pirate radio before us, we are supporting the undiscovered musicians who will form the future of music.” – David Borrie, Co-Founder.
Priority locations requirements are: London – South, Bristol, Cardiff, Nottingham and Sheffield.
Type & Size
Contact Mark or Russellor Benjie with opportunities.
With Brexit falling into the background and clarity on the political landscape, 2020 was expected to be a relatively calm year in which occupiers could push forward and implement their strategies with some re-assurance. However, with the global spread of Covid-19 and the subsequent lockdown, focus has altered and there are now a number of firms re-assessing their strategies and re-aligning their business needs. The consequence of this is a large reduction in transactional activity in Q2 of 2020.
The full effects of the Coronavirus pandemic are yet to be felt with regard to market response, however early signs show that demand within the office sector is still present, albeit at reduced levels. Even with these unprecedented factors combined we still anticipate that take up for 2020 will marginally improve on 2019 however it will fall well short of the 10 year average.
Take up for the year 2019 was 68,627 sq ft across Watford which was down 76% on the previous year and 69% down on the 10 year average which currently stands at 224,200 sq ft. Brexit, and the market uncertainty caused by the political landscape, had a major role in this downturn as did restricted office options. This trend was also evident in wider market in the likes of St Albans and Hemel Hempstead.
Similarly, while demand locally is not fundamentality strong, Watford has a number of drivers that are helping to push up demand such as a lack of any new development and an already constricted supply, particularly of Grade A quality – Watford currently has circa one years’ worth of office supply, the lowest of any major office district in the wider area.
With the continued under supply of office stock and lack of new development of Grade A accommodation, headline rents continue to remain robust around the region. In central Watford, headline rents have risen over 10% in the last 12 months to circa £36.50 per sq ft.
Landlords are seeking to counter the reduced demand and robust rental levels by enhancing incentives. This has been illustrated by transactions at Croxley Business Park, Breakspear Park and The Maylands Building. Where known these terms reflect extended rent free period rather than reduced rentals with landlords keen to bolt in interest and to ease new tenants through a period of reduced utilisation of space. Most of these transactions reflect requirements generated prior to the lockdown.
The extent of demand in the later period of the year is difficult to gauge with many tenants unsure about the extent and style of their office occupancy in the short term. It is possible that suburban locations such as the Northern home counties commuter towns could benefit from a reluctance to require staff to use public transport. At this stage this is all dependant on how the Covid-19 epidemic and possible mitigation measures unfold in the coming months.
The economic outlook may also be different over the next few years reversing the shortage of space as companies go out of business, downsize or adjust occupancy to save costs. There are already signs of this on the office supply side.
Industrial stock levels across the patch remain tight. Hemel Hempstead has seen notable speculative development, the only other noteworthy developments are Panattoni Park in Borehamwood and Symmetry Park, Aston Clinton (Phase 1 now fully let). Supply therefore remains almost wholly dependent on churn, particularly in the sub 10k bracket which the new developments have largely not catered for. This could of course change as companies are weaned off furlough.
Enquiry levels have remained consistent. In Hemel Hempstead 2020 take up to date is 58,051sq.ft in 8 transactions. The largest transaction was the sale of 27 Maylands to CAE Technology. This building was owned by Luton Borough Council but due to the capital expenditure required to bring the building back up the Grade A standard and the re-letting risk the Council decided to sell. CAE are relocating from Watford. The largest single unit is Hemel is currently 22,000sq.ft, and this is under offer. There is very little coming through the pipeline as the two units on Prologis Park are DC1 150,000sq.ft pre-let to a data centre (currently on site PC Feb 2021) and DC234 (233,860sq.ft) is under offer on a pre-let basis.
St Albans has seen little activity, not due to lack of demand, but rather little supply, The North Orbital Commercial Park has secured two new lettings, with units of c7,000ft and 6,800ft being taken by Sovereign Recovery and City Traffic Management, both at rents comfortably in excess of £10.00psf. Welwyn Garden City has seen a couple of lettings of note, with Ocado taking yet more space in the town, most recently a unit of some 30,000ft on City Park. Borough Box, an on-line specialist food retailer experiencing growth and benefitting from the continuing trend to web ordering, has leased 10,000ft at Quadrant Park, at a rent close to £12.00psf.
A little further south, Borehamwood has seen two sizeable transactions, in each case freehold sales completed just before lockdown. The former Regianni building in Chester Road was purchased by CBRE Global Investors, who plan a comprehensive refurbishment and re-modelling and subsequent letting. A price of c£5.8m was reportedly paid equating to a capital figure of c£200.00psf for this building of around 30,000sqft. 3 Manor Point in Manor Way, a building of c15,000sqft, was sold to Clipfine at a price breaking back to around £240.00psf. It will be interesting to see how interest develops in Panattoni Park, where a unit of c36,000sqft was pre let to UK Networks, effectively kick-starting the scheme, and a further unit of c155,000sqft is under construction, capable of being sub-divided. Phase two has the ability to accommodate requirements up to c140,000sqft
Demand for freeholds remains strong, with a core of applicants simply not being prepared to lease, and prepared to wait for the right property. This is particularly the case in the sub 5,000sqft bracket, with recent examples being a unit of c3,000sqft in Kings Langley where a sale was agreed at close to the asking price only a couple of weeks after going on the market. Terms were also agreed for a small unit of 1,000sqft in West Watford in a similar time frame with an industrial investment close by generating significant interest, with a sale agreed substantially in excess of the guide, again within a very short time frame.
Tim Howlings – Associate
The lockdown presented many challenges for many people, some more than others but one thing was for sure, it affected everyone!
To date I can personally count myself very lucky. My family contracted COVID but they suffered very mild symptoms, while I have remained healthy throughout (touch wood!). While we had our health, the lockdown experience was one of highs and lows.
The most pressing issue at the outset was my impending wedding due to take place in Jersey in a few weeks’ time. Should we? Shouldn’t we? Will the virus still be here in a few weeks? Little did we know that we would all be in this for the long haul. Moving suppliers, most of whom had downed tools themselves, proved to be tricky however, being put on furlough at the early stages made it easier to invest time, something that I wasn’t used to having. We found ourselves lucky that all our suppliers were able re-arrange our wedding at no cost.
Notwithstanding the above I personally found furlough life to be a cathartic experience. I had time to keep fit, pursue my interests and do some DIY, there wasn’t the guilt that I would usually have for not seeing friends and family, and of course, having two months away from the stresses of work was welcome.
Upon being called back to work I felt well rested, and a set up whereby I can work from home was a revelation – though I don’t have children which I am sure would present numerous challenges if working from home. Taking away the stresses and time pressures of the commute was welcome, but I missed human interaction. There was, and is, a considerable amount of give and take in this new world.
I feel the future of the office is as strong as ever however it will not be in the capacity we know. More flexible working for employees will be a must however this may present to be a benefit of the employer. Reduced overheads, a happier workforce who are now open to a better work life balance will only help benefit all involved ultimately.
Claire Madden – Partner
No one said it was going to be easy but in truth it was really not that bad either. The Madden family are lucky enough to live in a Hertfordshire village surrounded by fields. My teenagers, who both had exam years, were having lessons online and after a little more investment in technology myself and my husband were happily working from home.
My biggest issue was elderly parents who live 120 miles away in the suburbs of a West Country City. The first challenge was getting them to stay in at all! The second was technology, the third was how to get items to them, the fourth was all medical appointments were cancelled.
The first job was to we set up an ipad and sent it to them so that face time could become a reality. All they wanted to see was their grandchildren.
The suburbs have lost their local shops and overly rely on the larger supermarkets who do not offer a personal service. This is fine if you can get a slot to get shopping delivered but in the first few weeks this was not possible. Friends and neighbours were so helpful and kind Medical appointments were by telephone and thankfully the GP told my father in no uncertain terms he was not to go out (not just the family nagging!).
COVID has changed many things for this generation. I am pleased that technology is being embraced even if it is a slow process. The weekly shop has stayed online and only small top up shops are required. Social and medical appointments are slowly coming back into the diary.
As a nation we have done a great deal to protect this generation and I thank you all for your fantastic effort.
Graham Ricketts – Partner
One of my sons had already returned home from University for what should have been his Easter holiday, but faced with what looked like incarceration at home for an indeterminate period, he announced that evening that he would like to go back to his digs in Warwick (where his housemates were still living) and would I drive him. Hence I found myself loading the car and heading up the M1, conscious of whether lockdown had actually started and was I bending the rules ?. One of my other sons had last come home from Bristol university at Christmas and also decided to stay put, we didn’t see him again for another 3 months!
In truth lockdown has been quite kind to me, I am fortunate to live in a pleasant house in a nice town with plenty of room and a garden, and with both mine and my wife’s parents having passed away some years ago, we have not had the concerns of many of having elderly relatives to care for. Being placed on furlough was an interesting experience, not least of which temporarily losing access to my one and only e-mail address that I used for almost all internet interaction, hence a day or so of panic setting up a new one and feverishly updating web accounts. Otherwise furlough was largely catching up on much needed (and not so needed) DIY , extensive dog walking, and an awful lot of cycling.
Fortunately furlough was short-lived, just 3 weeks, and then came coming to terms with new ways of working, initially exclusively from home, and latterly back at the office, adhering to the new rules of social distancing and the like. I am old school and found working from home something of a challenge, focussing on work was not always easy with numerous distractions, and no real place to actually set up a home office. With three adult sons at home, with one also working from home, any space and some peace and quiet was at a premium. Of course there is also the much missed lack of social interaction, which I feel is hugely underestimated by those saying that the days of the office are numbered. Hence, some relief when we had the all clear to return to the office, with much reduced commute times due to lack of traffic and of course the ability to work from home if and when it suited, although for my part most days are office days, perhaps with slightly more leisurely starts, book-ended with housekeeping from home at the start and finish of the day.
Our client Tesco have ongoing requirements for new Express stores. Please get in touch with Neil Saunders with any suitable opportunities. Click here to see the detailed requirements.