BE Networking Sladen Estates

Brexit is benefiting the logistics sector by fuelling demand for warehouse space.

Rachel Wood, Managing Director of Sladen Estates, told our West Midlands event that the UK’s withdrawal is having ‘little effect’ across the company’s activities but is proving a boom for its industrial developments: “Brexit is having a positive effect for us. Logistics operators are having to find short term space. There is a massive flurry of activity with operators wanting to take short-term occupancy.”

Five-year deals are much more achievable in the current market according to Wood, which yield better than those on offer for ten-year leases, which is well timed for Sladen’s Nimbus Park speculative shed development on the edge of Doncaster.

Sladen Estates have secured HMRC as the tenant for the first phase of Unity Square, its 62,022 sq m office scheme development in Nottingham, which she described as ‘one of the largest pre-lets in the Midlands’ and they’ll hear in January on whether it has received planning permission for the scheme which it aims to complete in March 2020.

[emaillocker id=”71749″]

Birmingham is well placed to take advantage of any potential overhearing within the Manchester commercial market which ‘very few opportunities’ but ‘a lot of investors’ very interested in Birmingham. The pipeline of new office space in Birmingham city centre is restricted, said Wood: “There’s been some very good take up of Birmingham office space but not enough coming forward.”

Land owners remain reluctant to realise sites in the city despite rising rents and ‘really good yields’ being achieve in the city centre’s commercial property market.

Mark Lee, Chief Executive of the Calthorpe Estate, told delegates that Birmingham city centre has a good pipeline of office developments but reiterated that there is a lot of demand: “Several major relocations could easily take a year’s supply of Grade A and new requirements are coming out all of the time.”

He predicted that ‘cost conscious tenants’ would be looking at cheaper alternatives in the city centre due to the cost of land and construction pushing rental rates up. Calthorpe’s redevelopment of the commercial area around the Fiveways gyratory system on the outskirts of central Birmingham is one which falls into that category.

Calthorpe and its development partner U+I Group have received planning consent this year for 2,400 residential units and half a million sq ft of office space together with 900 car parking spaces. The hitherto peripheral Fiveways area will be within two tram stops of Paradise Circus in the city’s central business district once the Midland Metro extension is complete, Lee said: “We see it becoming an extension of the CBD when the metro extension is complete.”

He said the JV had just received expressions of interest in funding the scheme’s first office block and a preferred residential partner would be appointed for the scheme’s residential element in 2019, with reserved matters permission sought for next year too with a view of starting on site in early 2020.

Elsewhere on the estate, Lee said that Circle Health would be opening a £50m new private hospital, featuring a pioneering traumatic rehabilitation facility, in June 2019. The new hospital is being brought forward on the BBC’s former 22-acre Pebble Mill studio complex in Edgbaston, which Calthorpe is developing.

David Morris, Planning Director at Catesby Estates, said the seven sites in its West Midlands portfolio include a number in the Birmingham green belt, which could unlock around 3,000 homes, however the land’s release is awaiting a shortfall in the city council’s local plan to be resolved.

Catesby has signed a contract with two housebuilders on a site in Myton Green in Warwick, and its hoping to exchange a contract with another for 130 homes at the site, which is lined up for a total of 735 dwellings.

Morris said Catesby has also submitted plans for its site at the Woodside Conference Centre, Kenilworth, in tandem with the production of a development brief by the local planning authority for the site, which is earmarked for 640 new homes.  
[/emaillocker]