Market snapshot

Office Market Pulse M1 Corridor Q3 2013

Market conditions showed signs of improvement across the M1 Corridor during Q3, and with further transactions in solicitors hands, the outlook is promising as the year draws to a close.

You can download a PDF version of this M1 Corridor Office Market Pulse, or to read and sign-up to receive Office Market Pulses from other UK centres, click here.

In this issue:

Robust take-up across the M1 Corridor

  • After successive years of decline, Q3 saw office take-up stabilise in Luton, Milton Keynes and Northampton. 
  • Take-up for Northampton was 37,700 sq ft. With the year-to-date total now at 102,656 sq ft, take-up is already equal to 2012’s total.
  • Milton Keynes’ take-up was 41,112 sq ft, taking total take-up year-to-date to 92,389 sq ft. With a further 117,000 sq ft currently under offer, total take-up should be in line with 2012 (163,600 sq ft).
  • Luton office take-up reached 36,770 sq ft in Q3. With year-to-date take-up now standing at 63,700 sq ft and a further 44,179 sq ft under offer, the outlook for the office market is fast improving, after hitting a five-year low in 2012.

For an annual comparison of take-up, click here.

Significant occupational transactions Q3 2013

Property 

Size (sq ft)

Landlord(s)

Tenant / Purchaser

Lease       information         

Elgin House
Billing Road, Northampton

13,335

 

Five Charge Ltd 

 

Hewitsons

 

Confidential 

 

Phoenix House,
Central Milton Keynes      

15,500        

 

IM Properties   

 

The Gym Group 

 

15 year lease
£9.50 per sq ft

 

4 Dunstable Road, Luton 

7,818

Grant States Ltd      

London School of Science & Technology

10 year FRI
£6.00 per sq ft

Region’s supply remains static

  • Occupiers are trading up into better quality space, so supply along the M1 Corridor has remained largely static, despite robust take-up.
  • The shortage of good quality stock across the region continues to hamper the office market, and with a swelling in both take-up and demand, this situation is only likely to worsen in the short-term.

For an annual comparison of supply, click here.

Early signs of improved demand

  • Across the M1 Corridor markets, demand registered during the course of Q3 2013 peaked against five-year averages; Luton 136%, Milton Keynes 167% and Northampton 114%.
  • It is perhaps too early to suggest a wholesale change in fortunes for the office markets, but these results are certainly a step in the right direction.

For an annual comparison of demand, click here.

Investment hits six-year high

Our Q3 2013 UK Investment Transactions report shows that investment in UK commercial property hit a six year high in the third quarter of 2013.

At £11.6bn, quarterly investment levels are 50% above the post-2010 market average, and 40% up on the Q2 total of £8.24bn.

What does this mean for the market?

To view our latest UK Investment Transactions (UKIT) report, please click here.

Regions

Contact us now

Ian Leather
Head of Office Agency (Northampton - Milton Keynes - Luton)

01604 664399

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