Market snapshot

Office Market Pulse: South Coast Q3 2012

Office take-up on the South Coast has failed to maintain the level achieved in Q2, with several large transactions not completing in the anticipated timeframes. Consequently, take-up figures over the last three quarters have been below average. There has, however, been a welcome boost in office investment, with three significant deals completing in Q3.

In this issue:

Office take-up remains subdued

South Coast office take-up totalled 40,743 sq ft in Q3, compared to 83,396 sq ft in the same period last year. Transactions continue to take longer to complete, with a number of deals anticipated to conclude in Q3 remaining under offer.

For a breakdown of office enquiries over 5,000 sq ft click here.

Significant occupational transactions in Q3 2012

Property  Size       Landlord(s)  Tenant/purchaser Lease information 
Waterside House, Town Quay, Southampton 17,053 sq ft Associated British Ports  NHS

10 year lease,
£18.50 per sq ft

Building 100, Lakeside, Portsmouth 7,322 sq ft  Highcross  Douglas Stafford Ltd  Confidential terms
Bay House, North Harbour, Portsmouth 5,500 sq ft Heaton Property Service ISS Facility Services Confidential terms 

Reduction in total office supply

Office supply on the South Coast stands at 1.77m sq ft. This is a slight reduction on Q2, with several transactions completing and little stock returning to the market.

Office supply is further reduced by a number of buildings being subject to change of use applications to become student accommodation. This is the case for more than 120,000 sq ft across Park House, Richmond House and Orions Point. A substantial part of the Mayflower Plaza mixed-use scheme has also been converted to provide over 1,000 student rooms.

For a detailed breakdown of supply by centre click here, or for a breakdown of availability by grade click here.

 

Welcome boost in office investment

Following two consecutive quarters of no office investment, Q3 has seen some long-awaited transactions with circa £45m of activity.

Key investment deals from Q3 2012

Property  Size  Vendor Purchaser(s)  Price  Yield 
Skandia House, Southampton 108,857 sq ft  Legal & General Danmerc  £26.625m  7.2% 
Enterprise House, Ocean Village 25,000 sq ft  CBRE Global Investors  Forelle Estates  Undisclosed  Undisclosed
The Zurich Centre, Solent Business Park 52,878 sq ft  Legal & General Confidential  £13.5m  7.25% 

Want more information about this Snapshot?

Jerry Vigus

02380 206111

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Andy Hodgkinson
Director - Office Agency

023 8071 3075

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