What a difference 12 months makes, last year Hartnell Taylor Cook LLP were talking about Bristol’s commercial property market ‘awaking from its stupor,’ but this year they are reporting a record breaking year for the Bristol market that is stronger than ever with record take up figures being recorded in the office sector, record number of investments being traded and investor demand in the city higher than they can recall.
Bristol’s leading independent commercial Property Surveyors, Hartnell Taylor Cook LLP is looking to reinforce the message that Bristol is a place to invest at their annual review of Bristol’s commercial property market where they host over 60 investors who are travelling from all over the country including Edinburgh, London and Plymouth and representing the top pension funds, property companies, occupiers and private investors, today (Thursday, 14 May 2015).
Hartnell Taylor Cook LLP’s guests will be taken on a tour of Central Bristol and the Greater Bristol area by coach and boat, with commentary being provided by Hartnell Taylor Cook LLP’s Partners, providing a review of Bristol’s commercial property market, highlighting the areas of development and investment activity in the past twelve months and identifying areas for the future. The Tour will stop at the Bristol & Bath Science Park to hear from Richard Pitkin, Innovation Centre Director.
The review will demonstrate how the commercial property market has seen a staggering improvement in all sectors during the past twelve months, with the increased demand coming from institutional funds, private and overseas investors with a healthy appetite for regional centres. The interest has been generated by the continuing low interest rates, low inflation, low returns in alternative investment categories and the London and south east property market continuing to be overpriced. Bristol offers potential for substantial growth in rental levels and capital values.
In summary, the Bristol investment market has seen huge demand for all sectors but in the past 6 months the city centre office market has taken off with over £75 million traded and a further £100 million’s worth of deals in solicitors hands. This unprecedented market has been generated by fast falling office supply with limited new speculative buildings being constructed and numerous secondary, older office buildings being converted to residential accommodation under permitted development rights. With vacant stock at a record low of 7%, Hartnell Taylor Cook LLP anticipate a 15% rental increase in mid-market buildings, with rents for new office stock already rising to a predicted record high of £32.00 per sq ft at 66 Queen Square.
Investor demand for multi-let industrial estates and distribution units continues to be attractive, regardless of age or quality, with most investment stock being sold by the best bid route. It is anticipated in the next 12 months there will be a number of developers looking to start speculative development.
The retail investment market has woken up with a number of deals now happening in Broadmead with new rental tones established as historic leases come to an end and new re-based leases are agreed. The biggest deal in the past twelve months was the purchase of a 50% stake in Cabot Circus by AXA for £268 million.
The development market has also been active over the past twelve months principally driven by residential led initiatives. It is anticipated the North Bristol golden triangle will lead the charge with office, industrial and residential schemes being proposed as well as the extension of The Mall, Cribbs Causeway. In the city centre, the market for student accommodation and private residential accommodation remains unabated and the proposals at Temple Meads by Square Bay Properties and Redcliff Village by Change Real Estate will cater for the strong demand for city living.
Ian Lambert, Investment Agency Partner said: “The objective of the Tour is to provide a thorough overview of the commercial market in Bristol and point put areas and locations of activity where the next wave of development and investment is occurring.”
