A definitive report on the East Midlands commercial property market shows that the region is continuing to progress in a year that has been littered with challenges.
The Innes England Market Insite report has been monitoring the regional property market over the past decade – providing individual focuses on Nottingham, Derby and Leicester.
Across the region, the 2011 report highlights:
- the East Midlands is set to return to peak employment within the next three years, ahead of the West Midlands and northern regions
- industrial demand rose across Nottingham, Derby and Leicester
- the retail sector continued to make small steps amid muted consumer spending
Robert Hartley, managing director at Innes England, said: “If we look back to this time last year, who could have predicted that Derby, Leicester and Nottingham would be able to make any progress when globally we are still struggling in such a harsh economic climate.
“With bleak headlines about high unemployment levels and the ongoing saga to find a solution to the EU banking crisis, most people expected 2011 to be a struggle. What we have seen over the last 12 months however, was something much more positive than most people had expected, with significant highlights in all three cities.
“Although Derby’s economy took a hit after the Bombardier/Thameslink decision, there were other reasons to celebrate when it won more than £40million of support from The Regional Growth Fund. The robust reaction from both the public and private sectors and the successful bid for the funding showed the city was impressively focused on its vision for the future.
“Long term battles finally bore fruit in Nottingham as one major infrastructure project – the dualling of the A46 nears completion, and the welcome announcement was made confirming the long awaited widening of the A453. With this being one of the key routes in to the city, the news was welcomed by businesses across Nottingham. There was also the welcome announcement that an Enterprise Zone centred around the Alliance Boots Campus would be established. We also found that the industrial market stabilised and the office market remained ahead of its ten-year average for the third year running.
“Although Leicester did not hit the headlines like its counterparts, it was fortunate that it did not encounter the same setbacks. The news of the government’s decision to designate enterprise zone status to MIRA Technology Park in Hinckley will provide a long-term boost to the area. We also found impressive take-up figures across industrial, office and retail markets which was encouraging.”
Robert says the East Midlands commercial property market is almost certain to face another challenging year in 2012 with economic forecasts predicting, at best, no growth in the early part of the year with growth resuming in the second half.
He said: “As an industry, one of our key issues which will remain at the top of our agenda, is the availability of funding as banks continue to seek ways of rebuilding their balance sheets ahead of Basel lll, and stronger regulation predicted. As a consequence, funding for property, either existing debt or for new transactions, is likely to be extremely challenging.”
Robert added: “There are substantial challenges ahead, but we should not forget that Nottingham, Derby and Leicester all have substantial and diverse economies. I am confident that all three areas face these challenges head on and will continue to make economic progress in 2012.”
