At last week’s briefing, almost 100 attendees tuned into CBRE’s market update to listen to an overview of current market conditions across the South Coast.
The regional industrial market is proving resilient as demand continues to outweigh supply for good quality units. Prime rents have also seen strong growth, increasing 2.4% in the first three months of 2020, now ranging between £10.00-£10.50 per sq ft. Yields remained stable during Q1, currently around 5.0%.
Demand for industrial space has remained strong and in May CBRE let the remaining three new build units at Merlin Park, Portsmouth, which together totalled 34,500 sq ft, to Zidac Laboratories, bringing the Canmoor scheme to full capacity.
Commenting on the event, James Brounger, Managing Director CBRE Southampton said:
“There is a continuing appetite from developers for land and given the shortage of sites, it is still common to have strong levels of interest and competitive bidding for industrial land coming on to the market.
“This demand is likely to continue given the strength in occupier take-up for quality new build units.”
Over the last year CBRE has sold two sites in Poole of 10 and 8.75 acres respectively as well as 2.5 acres in Havant. In recent weeks there was strong demand from a mix of national and regional developers / investors as well as occupiers for a 16-acre Hampshire site which is now in solicitors’ hands. The best located industrial sites are now close to achieving upwards of £1m per acre.
Going forward, CBRE has identified that units between 50,000-100,000 sq ft will be required to fulfil the demand from online retail and last mile third party logistics occupiers as this sector is particularly stretched as a result of Covid-19 accelerating the use of online retail.
