Market snapshot

Office Market Pulse M1 Corridor Q1 2013

Despite continued lack of grade A office space across the M1 Corridor markets* Q1 2013 saw significant improvement in take-up for Northampton compared with Q1 2012. Enquiry levels remain steady across the region with many transactions set to complete in Q2.

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:

Mixed results across M1 Corridor

Northampton saw healthy take-up of 38,846 sq ft in Q1; a vast increase compared to Q1 2012 (just 2,300 sq ft). Take-up consisted of nine deals; eight of which were below 5,000 sq ft. Enquiry levels remained steady. For a breakdown of take-up, click here.

Milton Keynes’ Q1 take-up saw a total of 30,020 sq ft transacted in the +5,000 sq ft sector.60% of this total was comprised of one single letting. For a breakdown of take-up, click here.

Despite the lack of take-up in Luton & Dunstable during Q1, the increased level of enquiries experienced in Q4 2012 could result in several transactions completing during Q2. For a breakdown of take-up, click here.

Significant occupational transactions Q1 2013

Property  Size (sq ft)  Landlord(s)  Tenant  Lease info 

Pavilion
Linford Wood
Milton Keynes

 

18,026 Ignis Asset Management  Radiotherapy Clinic 

20 year lease  
£12.50 per sq ft
3 years rent free

Stirling House
The Avenue
Northampton
15,000  Tonbridge Investments
Limited (vendor)
NCC (purchaser) Purchase price £1.6m

Growing trend for conversion of office space

With the continued lack of grade A space across the M1 Corridor and the added implications of the impending Energy Act, a number of dated buildings are being deemed obsolete and considered for alternative use - as we have seen with the sale of Stirling House in Northampton

A 1980’s office building located on Cliftonville, the 15,000 sq ft three storey building has been vacant for some years but was recently sold to the NCC for conversion to a primary school. This reflects the necessity for landlords and agents to think laterally to try and maximise the value of a diminishing asset. For a breakdown of Northampton office supply, click here.

Grade A office space accounts for just 8% of Central Milton Keynes supply, and the volume of refurbished stock is dwindling. For a breakdown of Milton Keynes supply, click here.

Luton & Dunstable has seen a number of enquiries from developers looking to convert vacant 1970’s-1980’s office buildings to alternative uses with student accommodation and hotel uses currently being considered on at least two significant town centre buildings. For a breakdown of Luton & Dunstable supply, click here.

How did the investment market perform in Q1 2013?

Total investment in Q1 2013 rose by 8% in comparison to the previous quarter, reaching £8.05bn. 

The average deal size reached a new high of £28m. 

This activity was despite investment in central London offices falling by 25% in Q1 2013.

What does this mean for the market? Find out in UKIT 2013 and read our predictions for the year ahead.

 

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