Something of a stand-off is taking place in Wellingborough as pent-up demand builds for industrial/warehouse accommodation behind a long period of limited development says commercial property agent Prop-Search.
Research confirms that the supply of modern premises in certain size ranges is close to running out. New stock is desperately needed but even if developers had the confidence or the funding to build, the supply of readily available land isn’t there.
Simon Toseland, a Director of Prop-Search, comments: “The continual and gradual demand for small, quality industrial accommodation has led to the inevitable shortage of stock within the market place. Many smaller and medium sized businesses looking to expand are now faced with a real problem – limited built stock, no new development and even if they were to have the capital/funds available, little time to pursue this route.”
The supply and demand imbalance is now critical, particularly for units between 1,000 sq ft and 3,000 sq ft. On the 147 unit Leyland Trading Estate occupancy currently stands at over 96% with only one units of 1,050 sq ft immediately available to let and three of 2,100 sq ft.
A 2,356 sq ft unit at Harrowden Court on Park Farm – which forms part of the last speculative scheme to have been developed in the town during 2008 – has been let in just two weeks of becoming vacant. This underlines the supply and demand imbalance which is now critical.
There has been considerable take-up of space for industrial premises offering between 3,000 sq ft and 15,000 sq ft, particularly on the Park Farm Industrial Estate. In recent months, EDAC Europe has acquired an 11,995 sq ft unit on Fleming Close for its design and production business of electronic interconnect products; whilst upholsters Maton Rose Interiors has agreed to lease two units totalling 7,500 sq ft, also on Fleming Close.
Nearby, Werma – one of the World’s leading companies for optical and audible signal devices – has taken a new 10 year lease on a modern 9,500 sq ft warehouse property. And Hitachi Medical Systems UK Limited has taken occupation of a 13,000 sq ft facility on Davy Close.
The problem is just as acute for occupiers seeking large sheds of more than 200,000 sq ft. In fact there is only one unit currently available offering close to 100,000 sq ft.
Supply is even more impeded between 20,000 sq ft and 50,000 sq ft with only four units on the market. This follows the letting of Denington House, offering some 30,000 sq ft to Goodwill Solutions which deliver affordable solutions to household and office furniture needs to charities, third sector organisations and economically challenged individuals.
Further evidence of the poor supply of empty commercial property in the Borough can be found in the recent Tax Paypayers’ Alliance research on empty business rates. This identified that Wellingborough was the only authority in the County where the total value of void business rates collected in the financial year 2011/2012 went down. Indeed, it fell from £2,037,396 in 2010/2011 to £1,422,804 last year.
In summary, Wellingborough has a well-established, well located – in the centre of the UK – and successful industrial / warehouse market. It has equally successful businesses occupying these buildings. What is doesn’t have is a good supply of existing vacant buildings, nor a readily available supply of land to build on.
In conclusion, Simon Toseland adds: “At some stage, these factors will reach tipping point and the imbalance will be redressed. Let’s hope it’s soon.”
