Office supply in Uxbridge is diminishing, yet large-scale development has yet to get under way. Philip Smith reports.
All eyes are still on Land Securities’ Uxbridge One, where some 46,000 sq ft (4,273m2) remains unlet despite the return of BP, in the form of BP Exploration, as an occupier of over 40,000 sq ft (3,716m2).
Tim Young of DTZ Debenham Thorpe, joint letting agent with Phillip Sinclair Knighton, says : “We are not turning people away. We can be flexible.” The quoting rent, assuming a single occupier, is £21.50 per sq ft (£231.43 per m2). The vacant floors are being offered with 125 car parking spaces at a ratio of 1 per 375 sq ft (1 to 35m2) net.
But the fact that BP Exploration has moved into the building – which is not in one of the company’s hub sites in the City of London, Hemel Hempstead or Sunbury – highlights the town’s good road and rail links.
However, for BP, which does business all over the world, Uxbridge One’s location only 4 miles from Heathrow Airport is more important.
Young believes that Uxbridge One’s only rival in the town is Sun Alliance’s Charter Place. Some 18,300 sq ft (1,700m2) is available on the first floor of the high-specification scheme on Vine Street. Letting agent Savills is quoting £22.50 (£242.20 per m2).
But, despite falling supply, significant development has yet to get under way. As a result, rents have increased slightly.
“The situation is being driven by dwindling supply. There has been an increase of £1 to £1.50 per sq ft (£10.76 to £16.15 per m2) for basic accommodation without air-conditioning,” says Young.
Leonard Rosso of Jansons & Partners, who acts for the Grand Union Office Park in Cowley, hesitantly agrees: “Rents have been creeping up and incentives have reduced slightly. It is almost unnoticeable really.”
In the town centre, 27,700 sq ft (2,573m2) remains at Boundary House on Cricketfield Road. Letting agents Thomas Williams and Savills are quoting £16.50 per sq ft (£177.61 per m2). Space is also available in Senator Court on Belmont Road, and York House.
About 14,000 sq ft (1,301m2) is under offer at the 130,000 sq ft (12,077m2) Harman House, where a similar amount of space remains unlet, reveals Simon Williams of Thomas Williams, joint letting agent with Weatherall Green & Smith. The rent is in the region of £18 per sq ft (£193.76 per m2).
At Cowley Business Park, the completion of the 26,000 sq ft (2,415m2) Salmon House has marked the start of the scheme’s speculative second phase. Williams claims that the property is now on the shortlist of a well-known international firm.
The guideline rent is £20 per sq ft (£215.29 per m2), says Kevin Cook of letting agent Erdman Lewis (in receivership). Occupiers of the park’s first phase include J Sainsbury and Merloni Domestic Appliances.
Once rents rise to the right level, there is opportunity for development in Uxbridge. Scottish Amicable owns a 1 acre (0.4ha) site on Vine Street which has office consent, and Grosvenor Square Properties has a site at Mahjacks roundabout which could, with consent, feature some 70,000 sq ft (6,503m2) of offices. At Harefield, development will start in the New Year on 26,730 sq ft (2,483m2) of offices and studio workshops at Coppermill Lock.
Nick Evamy of Knight Frank & Rutley believes that Uxbridge is in a good position to capitalise upon new development when it does occur, especially when compared to town centres in a superficially similar position, such as Slough, Bracknell and Maidenhead.
“The key is that there isn’t a big overhang of new space as there was in the other areas,” adds Evamy.
However, prospects for movement in the industrial market are not as good. There are historic reasons for this, argues Williams: “The industrial base has been held back by the lack of infrastructure.”
Improvements to the access to Uxbridge Industrial Estate are limited by the single-track humpback bridge at the main entrance.
Planning restrictions are also creating pressure. “Land supply is very tight,” says Howard Redhouse of Knight, Frank & Rutley. As a result, he believes, Uxbridge is losing out as industrial demand is satisfied in Hayes and Heathrow.
Nevertheless, interest is such that good rents are being achieved on refurbished industrial units. Redhouse points to two deals on Eskdale Road of 24,000 sq ft (2,230m2) and 6,000 sq ft (557m2) which reportedly achieved rents in the region of £5 per sq ft (£53.82 per m2).
“For refurbished units, these are reasonable rents and that is reflected in the fact that space is tight,” says Redhouse. This lack of supply has not led to drastic rises in rent, but deals are hardening.
If high-quality stock were available rents could rise, Redhouse suggests. “You would even get £7 per sq ft (£75.35 per m2).” But at the moment such buildings are just not in the market-place.
Planning restrictions in the past decade have not helped the supply situation. “Many industrial sites were used for B1 offices,” Redhouse recalls.
Meanwhile, in the retail sector, Tim Johnson has been appointed town-centre manager. This follows an initiative by Prudential, Sun Alliance, Boots, Marks & Spencer and Hillingdon borough council, and is intended to halt the decline of the past few years.
With a budget of £50,000 a year, Johnson’s main aim will be to improve the town centre before considering a marketing campaign. Projects such as refurbishing the pedestrian areas will take priority.
However, Williams is not alone in his belief that the improvement of the town centre will remain an uphill battle while there is so little progress on St George’s shopping scheme. Sun Alliance has long tried to get the scheme off the ground on the site of its existing town-centre holdings, but a planning application has yet to be submitted.
Agents are almost unanimously in favour of St George’s, which would give Uxbridge a major shopping boost. “Uxbridge isn’t pulling on its catchment area,” claims Sun Alliance’s James Kerr, saying that St George’s should appeal to the A, B and C1 class of shopper. Williams agrees, adding: “This scheme is designed to lift the tone of Uxbridge and appeal to the As and Bs.”
Even agents advising on The Pavilions, Prudential’s existing 370,000 sq ft (34,373m2) centre, agree that a complementary shopping scheme could be just what Uxbridge needs to establish itself as a sub-regional centre.
“At the moment, we haven’t physically got the space for a department store such as Debenhams,” admits Dermot Supple of Knight, Frank & Rutley, letting agent for The Pavilions.
He believes that there is a clear opening for the new centre if it is tailored to fit the town’s needs for department and variety stores. In his opinion, such a scheme “could benefit both the town and The Pavilions, especially if new retailers are attracted to the town”.
He points out that, apart from Marks & Spencer in The Pavilions and the small Owen Owen department store at 159-161 High Street, the town lacks other department/variety stores.
Mark Haverstock, The Pavilions’ centre manager, is also keen to stress a spirit of co-operation. “We feel pretty secure about the idea. Uxbridge needs additional modern retail space. After St George’s has launched, we will work with them.”
However, an application has still to be submitted for St George’s. “Heavily revised” plans for a 400,000 sq ft (37,160m2) centre – including a department store of between 105,000 sq ft and 140,000 sq ft (9,755m2 and 13,006m2), two variety stores and 65 smaller units – are currently being finalised for an application early next year, says Kerr. He anticipates that work on site will start in 1997, with a provisional opening date for spring 1999.
In the meantime, Uxbridge continues to suffer as a result of these delays. “To some degree, [the uncertainty over the scheme] has blighted the town centre because people see the temporary lettings by the tube station entrance,” says Williams. However, Sun Alliance has spent some £35,000 this year on the upkeep of its units on the proposed St Georges’ site. And Kerr adds: “We try our best along the High Street to attract retailers other than discount stores and to improve the environment.”
Activity at The Pavilions, which was last refurbished in 1989, seems healthy. This is reflected in the rents and low incentives. “The maximum rent-free we go to is six months,” says Supple. “We have managed to build on the tenant mix.” This has been achieved through temporary lettings to value-for-money retailers such as Everything is a Pound.
Along The Pavilion’s High Street frontage, where retailers include Marks & Spencer, Vision Express and Burtons, zone A rents reach £100 per sq ft (£1,076.43 per m2), according to Supple. Following a letting to Future Zone, rents along The Pavilions’ Mercer Walk have hit £90 per sq ft (£968.78 per m2). Then, still within the centre, along Pantile Walk, they fall to £50 per sq ft (£538.21 per m2). At the far end of the High Street a series of empty units is a constant reminder of delays in the development of St George’s shopping centre.
