NW speculative build trade counter schemes reap rewards
- Trade counters are increasing their footprint and now account for almost 20% of all floorspace in the North West
- Despite reducing their footprint, general manufacturers remain the region’s single largest occupier sector at 22%
- North West sees “ripple effect” of high ERV growth in other geographical locations, pushing occupiers into the region
Manchester, UK – Speculatively-built trade counter schemes have been the overriding success story in changing occupier profiles across the North West – according to new research from Gerald Eve’s latest Multi-Let report, one of the most detailed and thorough research reports in the UK.
The trade counter sector has increased its footprint year-on-year and now represents 19% of the region’s multi-let floorspace, just 3% behind general manufacturing, which has steadily declined over recent years in line with the national picture. Business support, document storage and public sector occupiers accounted for 15% followed by off-site services (11%), retail and business storage (9%) and logistics (6%).
The report, which covers 17,251 units across 1,579 estates, in units ranging in size from 500 to 50,000 sq ft, found that voids have dropped in the North West to 9.9% at the end of 2018, potentially because the high Estimated Rental Values (ERVs) of other locations are pushing occupiers into the region.
This trend is evidenced in strong occupier take-up, as Jason Print, head of North West industrial at Gerald Eve, explains: “The trade counter sector in the North West has outperformed all of its regional counterparts. We believe the region is a beneficiary of the ‘ripple-effect’ we are seeing with occupiers looking for more competitive rental values. We are advising on a number of speculatively built schemes in this size bracket, all of which have seen high take-up levels.
“Aurora in Stockport and Logic in Rochdale were 75% let or under offer upon practical completion and we currently have three of 12 units let or under offer to trade counter operators at Artis Park in Cheshire before a spade has even gone into the ground.
“All of these developments achieved market leading rents in their respective areas, which demonstrates the demand is there for high quality stock in the right location and we see no sign of this trend abating.”
First undertaken in 2007, Gerald Eve’s Multi-let report is the most extensive and in-depth research into the UK’s small industrial sector. Analysing units between 500 and 50,000 sq ft in size, the report covers 17,251 units across 1,579 estates, and has been undertaken in partnership with the sector’s leading landlords. Covering estates totalling 108 million sq ft of space and with a capital value of over £14 billion, Multi-Let draws on data which equates to 44.2% of the MSCI standard industrial universe.
Full list of contributors: Aberdeen Standard Investments; Aviva Investors; BMO Real Estate Partners; Caisson Investment Management; Cedarwood; Clipstone Investment Management; Hansteen; IO Asset Management; LaSalle Investment Management; Logicor; Legal & General Investment Management; M&G; M7 Real Estate; Northern Trust; Patrizia; PGIM; Schroders; SEGRO; Stenprop; UBS; and Warehouse REIT.