As part of FHP’s Quarterly Review we have found that enquiry levels in the first three months of 2015 have increased by 25% on the previous 5 year average for the same period. This is showing a general increase in enquiry levels across all size brackets in both the office and industrial sectors.
We are finding that although businesses are indeed in the market thinking more progressively about property moves, they are being frustrated by the lack of available existing stock required to achieve any required expansion. This has become a theme especially in the industrial sector and this lack of stock has seen rents increase over the last 12 months as well as freehold values. Unfortunately rental values, lease lengths and freehold values are still not at appropriate levels in many cases to stimulate speculative development given high build costs.
Therefore the issue over the lack of available existing stock is not one which is going to disappear overnight, but perhaps it will not be long before the underlying expansion requirements of the larger local businesses as the values increase enough to stimulate development.
