A new report by GVA, the UK’s largest independent commercial property advisor, indicates UK business parks have remained popular with occupiers despite the ongoing recession and future outlook.
However it remains clear that the business park model is being forced to evolve in order to survive rapidly changing occupier requirements. Whilst activity has remained subdued in the South West in Q1 and Q2, alongside many other regions in the UK, the level of supply has heightened the need for alternative uses to be brought forward.
The GVA Business Parks report states office take-up in the first six months of 2012 totalled 2.47m sq ft nationally, an increase of 8% on the previous six months, which is also encouraging against a five-year six-monthly average of 1.95m sq ft.
The largest deal in the South West was 40,000 sq ft at Aztec West to BNS Nuclear Services, with some signs of increased activity outside the core Bristol market with significant requirements in Exeter and Swindon.
GVA’s regional head of office agency in Bristol, Ben O’Connor, says: “Most growth has come from high-tech, automotive/engineering and aerospace industries, which tend to focus their requirements on business or science parks because of the varied benefits they offer. It is these sectors experiencing growth that will ensure the survival of well located business parks with the facilities to match.”
Nationally, out-of-town office rental growth has remained stable over the first six months of the year after a less than 1% growth over the previous six months.
The amount of office space under construction in UK business parks however remains at its lowest level since the survey began. The report indicates the space under construction currently stands at 657,000 sq ft – 75% of which is pre-let space. These figures reflect the cautious sentiment among developers with the emphasis on pre-let development.
A total of 17.7m sq ft of floor space is immediately available for occupation, a 5% increase on the previous six months. The South West is one of just two areas in the UK (with the South East) where availability has increased by more than 5% – elsewhere availability has remained stable.
Ben O’Connor continues, “The key to business parks’ continuing role in contributing to economic growth will be their ability to respond dynamically to occupiers’ diverse range of requirements.”
