News

Manufacturing on the move

News

Estates Gazette

20 June 1987

by Alex Catalano

British industry could be on the move in a major way, according to a new report by Edward Erdman, Industrial space.

Their survey of 634 CBI member firms found that almost one in three were planning property changes over the next five years, with 40% of those expecting to move in the next year. A further 35% were going to acquire properties, and 25% envisaged closures over the next 12 months.

Most of the movers will be looking for premises in their local area, in order to keep their workforce. “As a result,” say Erdman, “they will often take property which is far from ideal for their business.”

Over half of those responding said that changing markets were the major factor behind the reassessment of their properties; technical change came second. Other influences included company expansion, lease expiry, cost, and the age or state of their existing premises.

Just under two-thirds of those surveyed said the available properties were adequate for their needs, but large companies employing more than 5,000 people tended to be the most dissatisfied with existing supply.

The main grumbles about the current stock of industrial properties concerned size, eaves height, insufficient office content and insufficient parking. The survey found that buildings more frequently housed several different uses than a single use and, on average, 13.5% of floorspace was devoted to offices. One interesting finding was that 44% of the total sample had applied for a change of use.

Erdman also questioned companies on their attitudes towards different tenures. Just over half said they would prefer freehold, but it was the smaller companies who favoured this tenure. The survey also found that tenants favoured shorter leases of five to 10 years. However, most were not willing to pay a premium for this.

Erdman also gave their own impressions of the corporate attitudes which they encountered via the survey. “We gained the strong impression that British industry has failed to take its property seriously in the past. There appears to be little corporate or strategic thinking regarding property; decisions are largely influenced by short-term considerations and tend to be made at short notice.”

by Alex Catalano British industry could be on the move in a major way, according to a new report by Edward Erdman, Industrial space. Their survey of 634 CBI member firms found that almost one in three were planning property changes over the next five years, with 40% of those expecting to move in the next year. A further 35% were going to acquire properties, and 25% envisaged closures over the next 12 months. Most of the movers will be looking for premises in their local area, in order to keep their workforce. “As a result,” say Erdman, “they will often take property which is far from ideal for their business.” Over half of those responding said that changing markets were the major factor behind the reassessment of their properties; technical change came second. Other influences included company expansion, lease expiry, cost, and the age or state of their existing premises. Just under two-thirds of those surveyed said the available properties were adequate for their needs, but large companies employing more than 5,000 people tended to be the most dissatisfied with existing supply. The main grumbles about the current stock of industrial properties concerned size, eaves height, insufficient office content and insufficient parking. The survey found that buildings more frequently housed several different uses than a single use and, on average, 13.5% of floorspace was devoted to offices. One interesting finding was that 44% of the total sample had applied for a change of use. Erdman also questioned companies on their attitudes towards different tenures. Just over half said they would prefer freehold, but it was the smaller companies who favoured this tenure. The survey also found that tenants favoured shorter leases of five to 10 years. However, most were not willing to pay a premium for this. Erdman also gave their own impressions of the corporate attitudes which they encountered via the survey. “We gained the strong impression that British industry has failed to take its property seriously in the past. There appears to be little corporate or strategic thinking regarding property; decisions are largely influenced by short-term considerations and tend to be made at short notice.”