A lack of office space for businesses that want to expand or relocate is driving up rents in Northampton, according to national commercial property consultancy Lambert Smith Hampton (LSH).
Whilst the shortage of available stock may be bad news for businesses, it is good news for landlords so long as they invest in their buildings aiming to provide “better than average” accommodation, said Ian Leather, head of office advisory at LSH in Northampton.
According to the latest LSH Office Market Pulse, a new headline rent of £18.50 per sq ft for existing space was recorded in Q2. Century House, on The Lakes, comprising 9,300 sq ft of office space, was fully refurbished by Schroders REIT and has been let on a 10-year term to Talent Works to accommodate significant growth in their business.
Ian added: “At the same time, LSH managed to negotiate an assignment of the exiting TW lease at Queensbridge where Venture Contracts took over 3,625 sq.ft. Both deals reflecting the growth of local companies and the need for better quality offices in the market.
“LSH has also negotiated a new headline rent on Northampton Business Park with 4,000 sq.ft let to Orbit Housing at £16 per sq.ft.”
Current activity is muted but largely restricted by a lack of available quality space. New development is due to start in Q3 on Waterside Way at The Lakes when we will announce new prime headline rents in excess of £20 per sq ft and a significant upward shift in capital values.
“Currently there is around 100,000 – 125,000 sq ft of unsatisfied occupier requirements which continue to be held back due to the lack of new stock being delivered and a lack of choice. This is great news for landlords who invest wisely in their existing buildings and provide better than average space,” he added.
