Recent deals at Beeches Industrial Estate in Yate have highlighted how limited availability of industrial stock in the Bristol area is driving rents higher, according to commercial property advisers Colliers International.
The Industrial & Logistics team in the Bristol office of the global real estate company recently completed three deals at the estate, which is owned by DTZ Investors.
Two of the deals have breached £9.00 per sq ft, with leases of £9.10 per sq ft being agreed in separate deals on Unit 56 and Unit 57. A lease of £8.80 per sq ft has been agreed for Units 58-59.
Tim Davies, head of the Industrial & Logistics team in the Bristol office of Colliers International, said: “The industrial market in Bristol is very strong, and it is increasingly likely that rental levels for industrial stock in the Bristol area could soon breach £10.00 per sq ft on sub-5,000 sq ft because of a combination of demand and lack of supply.”
The deal on Unit 56, which totals 2,110 sq ft, was with Touchpaper Limited, which has taken a 10-year lease with a five-year break option.
Unit 57, which also totals 2,110 sq ft, has been taken by MATtest Southern Limited on a 10-year lease with a five year break option. This new site will form part of their national laboratory network, and will be used as a material testing facility.
Units 58/59, totalling 4,218 sq ft, have been taken by Travis Perkins at £8.80 per sq ft on a straight five-year lease, and will be used by their Managing Services department following their new contract supplying materials to Merlin Housing Society.
Tom Watkins of the Industrial and Logistics team said: “Similar units within the terrace let at £8.50 per sq ft last year, which shows a £0.60p increase in rent per sq ft within 12 months. If stock continues to diminish, rents are likely to rise ever closer to the £10.00 per sq ft mark for the smaller units.”
He added that demand for industrial stock in the Bristol area was such that a new trend had emerged for potential industrial tenants to register interest as much as a year before planning to move in order to ensure suitable premises, resulting in off market deals involving examination of tenancy schedules.
“We ended up surrendering a lease on Unit 59 at Beeches in order to accommodate the requirement from Travis Perkins, which could be a risk on the landlord’s part, but is justified by a new five-year lease with a good covenant company,” he said.
Colliers International, acting jointly with Jones Lang LaSalle, is marketing two other properties on Beeches Industrial Estate: Units 11-14 which extend to 28,395 sq ft and Unit 25 which extends to 7,109 sq ft. Both of these industrial/warehouse units are available for immediate occupation on new leases for a term to be agreed.
