Sat 18 May 2013
Nottingham making significant progress, says Innes England report24 February 2011
A definitive report on the East Midlands commercial property market shows that Nottingham saw significant progress in 2010, despite some of the most challenging conditions the market has seen.
The Innes England Market Insite report has been monitoring the regional property market over the past decade - providing individual focuses on Nottingham, Derby and Leicester.
In Nottingham, the 2010 report highlights:
- A 50% rise in industrial market activity, with take-up driven by a series of major deals
- The highest level of investment activity in the East Midlands, with nearly £300 million worth of deals concluded
- A new headline rent level in an office market where demand for high quality space outstripped supply
- Retailers with strong brands have taken advantage of rationalisation by other outlets to trade up into prime locations
"Nottingham recorded the highest level of investment activity for the region, there were major deals in both the office and industrial markets, while retail is now looking forward to potentially two significant shopping centre revamps and the launch of the Retail Business Improvement District."
Craig says that the government's decision to confirm funding for the extension of Nottingham's tram network, as part of the Comprehensive Spending Review, has been well-received by the market. However, there are concerns that the Workplace Parking Levy, one of the funding mechanisms, may impact on occupiers' choice of locations.
The demise of the Nottingham-based East Midlands Development Agency is another concern because of the impact this could have on regeneration activity. The Insite report says the onus will be on the business community to ensure its successor, the Nottinghamshire and Derbyshire Local Enterprise Partnership make the region's voice is heard at national level.
The Insite report's analysis shows that declines seen in the industrial market in previous years were halted in 2010, though activity remains subdued compared to historic levels. It also points to a two-tier office market, with a clear split between an over-supply of difficult-to-let older stock and an under-supply of high quality and Grade A space.
Nottingham's crucial retail economy is likely to get a shot-in-the arm during 2011 from Westfield's decision to invest £40m in a substantial remodelling and refurbishment of the Broadmarsh Shopping Centre, with hopes that it will attract new retail blood. Capital Shopping Centres has also been drawing up plans for a 400,000 sq ft extension of the Victoria Centre.
The retail core around Bridlesmith Gate is also likely to benefit from the opening of Jamie Oliver's Jamie's Italian alongside Paul Smith, and the arrival of a Carluccio's restaurant and deli.
Craig added: "It's a tribute to the size of the Nottingham economy that we still saw a number of significant office deals, including Miller Birch's pre-let to E-ON - the largest transaction of its kind that year outside of London.
"There was also movement on the city's fringe , with Speedo switching to a landmark headquarters at the NG2 Business Park, and the Chinese car company Changan coming to Blueprint's No 1 Nottingham Science Park. The Changan move represents a significant inward investment and a coup for the city against competing locations.
"Nottingham has waited a while for significant movement in retail and leisure but we will see some welcome activity in 2011. It remains challenging for the retail economy, but Westfield's investment reflects the city's continuing status as a shopping destination of national standing."
"The Comprehensive Spending Review and rising inflation are almost certain to be felt in the market in 2011, but there are clear opportunities for the property industry and Nottingham has to make sure it is in a position to exploit them."