High for Highcross

Although city centre office lettings in the region are slow, the out of town business parks have really performed. Lakeside on the former IBM factory at Portsmouth has experienced a spate of lettings culminating in the Southern Co-operative taking 1,593 sq.m. The park now has 70 companies employing 4,500 people, including IBM which is still located there. Russell Mogridge of Hughes Ellard said: “The 130 acre park has attracted more than half of the lettings in the Solent corridor since January.

There are a further four deals totalling 11,148 sq.m. at various stages of completion.” The business parks may be where the action is now but Southampton City Council is pushing hard to make the city centre more attractive for business. It has welcomed the plan by Arcadian Estates, part of the London & Henley Property Group, for the redevelopment of the East Street Shopping Centre. It will be demolished and a Morrisons’ food store constructed on the site in partnership with Centros. As part of the scheme, there will be new access between East Street and Evans Street. In turn that will help, said John De Stefano of London & Henley, “our nearby Capital House office building.”

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MAG builds more at airport

MAG Developments has the determination to undertake significant development at its UK airports even if Manchester is far and away its most important facility.

At Bournemouth, it has a 10 year programme and has submitted a plan for 41,991 sq.metres (452,000 sq.ft.) at its Aviation Business Park. The majority of this will be warehouse and industrial space on the 35 acre site.

It is part of a phased plan to expand the capacity at the airport, where it has recently invested £45 million. David Roberts of MAG commented: “These plans provide a clear long term strategy for the business park and will complement existing stock on the estate. That will attract investment through development opportunities.” It has proved its point with Aviation Business Park where there is an occupancy of around 95% after two lettings totalling 2,320 sq.metres (24,967 sq.ft.), one of which was to Talard Thai which relocated from nearby Christchurch. The company supplies a wide range of foodstuffs and flowers from Thailand.

The other letting was to the specialist aerospace interiors manufacturer, AIM Aviation. The two lettings follow a 3,279 sq.metres (35,295 sq.ft.) pre let to City Link. City Link’s Steve Jones said the relocation from a nearby property would allow the company to expand its operations in the Bournemouth area. “The demands of our customers have changed dramatically. They are very different from 10 years ago and we have to accommodate that,” Jones added.

Aviation Business Park currently provides 139,350 sq.metres (1.5 million sq.ft.) of mixed use business space and is home to 140 businesses with a working population of over 2,000.

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Fair wind for Weymouth

While many parts of the UK have experienced trying commercial property markets, the south coast has bucked the national trend with a period of improvement.

That applies from Hampshire to Dorset. The major urban areas have benefited from their broadly based economies, taking in services and manufacturing, but it is noticeable how Weymouth, not noted for either of these two activities, has become more dynamic. Of course that is mainly due to it being the host for the 2012 Olympic yachting events but the hope must be that it has been given a new lease of life that will break the log jam of development.

It is clearly apparent how the town now buzzes with activity, helped by a new main road. At the moment it appears that Weymouth is a star performer for the regeneration lobby. The market in the core area of Southampton and Portsmouth, (the Solent corridor) has been solid and even retailing has not been as poor as in many parts of the UK. Russell Mogridge of Hughes Ellard said: “The office level of take up in the region is above pre-recession levels at the end of the third quarter, reaching 32,515 sq.m. compared with the 10 year average of 23,225 sq.m.“ A significant part of this has been at Highcross’ new business park, Lakeside in Portsmouth. This has reached a 65% let in building 1,000 by achieving 9,290 sq.m. of lettings this year. Phase two of the development will begin soon.

Among the trends noted by Mogridge are companies relocating to single floor plates to aid team performance and staff morale as well as improving their working environment. “We have seen movement in the professional service sector, such as recruitment, legal and accountancy,” he added. Nik Cox of Hughes Ellard said: “We are hoping that the out of town activity will percolate to the Southampton city centre, which has seen a limited office take up, probably reflecting the lack of Grade A space available.” Cox also noted that the manufacturing sector had been active and reflected the diverse economy from shipbuilding, defence and high tech. Jones Lang LaSalle’s Jason Webb said: “There are still significant opportunities for occupiers to obtain costs savings on the M27 but the lack of speculative office development means that the pipeline will remain severely limited and as Grade A supply reduces further, the window of opportunity for tenants is expected to close.”

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