Occupier Confidence Begs Development in South Yorkshire
1st April 2015
Developers are being encouraged to consider South Yorkshire as their next project base as occupier confidence improves and stock dwindles across all size range property in the logistics and industrial sector.
The LOGIC report for H2 2014 highlights this as the Sheffield office of Knight Frank saw an increase in demand for units up to 100,000 sqft from a variety of occupiers. There was also strong occupier interest from advanced manufacturers, typically looking for higher quality accommodation including success at the Advanced Manufacturing Park, following the speculative development of two units at R-Evolution, while Factory 2050 at Sheffield Business Park is now underway and attracting further interest from occupiers wanting to locate close by. However, take-up for the whole of 2014 was influenced by limited availability of existing stock and as a result of the shortage of supply. Where lettings were seen it was evident that landlords were able to secure longer lease terms and shorter incentive packages as occupiers were faced with limited choice of existing premises. Head of the Yorkshire Industrial Team and partner at the Sheffield office, Rebecca Schofield, said: "Whilst much of the good quality standing stock has been absorbed, we are yet to see a more rigorous response from developers. There are however a number of sites ready for immediate development such as Smithywood and G Park Doncaster. "Occupiers will increasingly need to consider design and build opportunities, which generally take up to 12 months to be delivered." Knight Frank has started to see some speculative development come forward at the smaller end of the size range (sub 20,000 sqft) including Bullrush Grove, Doncaster and Vantage Park, Sheffield which was supported by ERDF. Both are on site and are attracting a good level of interest. South Yorkshire transactions across the second half of 2014 included 68,200 sqft to Portwest at Midway One in Sheffield and 277,000 sqft to Victoria Plumb at V277 in Doncaster. Rebecca added: "We see prime headline rents to continue on an upward trajectory across most submarkets. Incentives are expected to move in further over the next 12 months. "In Sheffield, Barnsley, Doncaster and Rotherham prime headline rents are expected to be in excess of £5 psf depending on square footage taken for 2015." For further information contact Rebecca Schofield, South Yorkshire Industrial Agency on 0114 272 9750 or email firstname.lastname@example.org