With the continued uncertainty about the Brexit process and the Donald Trump Presidency, the outlook for the UK commercial property investment market over the next three to six months should remain unsettled, although depending on the level of uncertainty and the markets’ reactions, this could quickly return to fair / good. The sentiment at present is encouraging with unprecedented demand for the right commercial property and mixed investments therefore it is hard to see the uncertainty in our area around Stourbridge and North Worcestershire.
Birmingham appears boom boom boom at the moment with excessive demand for residential property and the stock of Grade A offices being let – major new employment with the HSBC relocation to the city and the start of the long awaited HS2.
At Walton and Hipkiss we are seeing a continual demand for commercial property with buildings in the right location and well-priced proving popular. Land also is in demand predominantly for residential purposes but we are now seeing a surge in demand for commercial development land and the promise of much awaited speculative industrial and office development, although at a small level.
As I write this we have now fully let all of the office and workshops at Hagley Mews at Hagley Hall and have a waiting list for tenants looking to move in.
Despite a turbulent 2016 politically and economically, the commercial property market proved its resilience and ended the year on a high note, but it should take note of warning signs and the continued political and economic uncertainty.
Property investment intentions are good particularly from foreign sources with the current exchange rates and with the availability of stock at a historic low level as many owners are choosing to hold property due to the difficulty of re-investing this creates an extremely challenging market for investors and their advisers.”
The Bank of England Summary of Business Conditions report for February notes consumer spending growth had remained resilient, but was expected to ease during the year as prices rose. Investment intentions had edged higher and pointed to small increases in spending during 2017.
Investor demand for UK commercial real estate had risen from a low level. That reflected increased interest from foreign investors. Commercial rents were flat or rising modestly across the United Kingdom. Housing market activity had been sluggish overall, and was expected to remain so over the coming year. (this was more about lack of supply feeding the demand – values continue to be under upward pressure)
On the local front within Dudley Borough a major Enterprise Zone initiative has been announced to be known as “DY5 Dudley’s Business and Innovation Enterprise Zone” and is based in the borough’s strategic centre of Brierley Hill. It aims to be the high tech office hub of the Black Country, connecting advanced manufacturing to industrial sites via a new sustainable Metro link.
The enterprise zone will be reinforce Dudley as a location of choice for business and innovation with low cost and high quality office space connected to regional infrastructure. It will look at how the manufacturing and technology of the region can help deliver new business as well as broaden its digital and professional base into existing manufacturing technology.
The enterprise zone will reinvigorate the existing Waterfront office complex, and as well as doubling the total office accommodation on offer around the site to 1.5million sq. ft., it will expand onto vacant industrial land in the surrounding area.
Dudley’s existing manufacturing and industrial base will be bolstered by the introduction of new industrial space as well as creating new accommodation for businesses in the technology and service sectors.
The high tech hub of the Black Country will create 7,000 new jobs over 25 years and will be officially launched in April 2017 – for more information on how this can help your business go to www.dy5enterprisezone.co.uk .
So again interesting times ahead and please remember to take professional advice on all aspects of your commercial properties, talk to us about a free property health check and look at the future potential of your ownership.