Bumper 2008 High office take-up last year cannot be sustained. By Stacey Meadwell
Not many parts of the UK have bucked national trends with bumper performance over the past 12 months, but Kent is one of them. According to Knight Frank, the take-up of office space in chunks of more than 10,000 sq ft was nearly double 2007’s figure.
Emma Goodford, head of national offices at Knight Frank, says that, when compared with the county’s average annual take-up of 150,000-200,000 sq ft, last year’s figure of 330,000 sq ft was a “bit of a highlight”, and she does not expect this to be repeated in 2009.
“Take-up this year will be down, but will be hard on 2007’s figures at around 170,000 sq ft,” she predicts.
Inevitably, there will be some downward pressure on rents, but Goodford does not believe there will be a significant slide because the Kent market never got “overpriced”.
Rents vary widely across the county, but in key locations, such as Dartford and Maidstone, they range from £22 per sq ft to £24 per sq ft.
Vacancy is about 5%, with a few speculative buildings under way.
The industrial market did not enjoy a peak in take-up last year, but according to Colliers CRE, it did manage to put in a performance on a par with 2007. Rents remained stable across key centres, but agents are expecting conditions to get tougher this year. Akhtar Alibhai, associate director at Colliers, says: “We are entering into a recession, businesses can’t get credit, and consumers aren’t spending, which has to filter down. There are a number of units coming back onto the market.”
Oversupply is a real threat, says Alibhai, not a scenario to be relished in Dartford, where there is already more than 1m sq ft of space available.
Alibhai says rents will come down in those locations where competition for occupiers is toughest. Nonetheless, he says enquiries were up in January compared with the end of last year.
Retail rents across the county have either stagnated or remained stable, depending on your perspective. With high street retailers almost uniformly struggling, few agents predict growth this year. Kent’s high streets are not alone in losing retailers such as Woolworths and Zavvi.
Bluewater recorded its busiest day in terms of footfall over the Christmas period, but how much those visitors were spending is probably more pertinent to the centre’s performance.
Industrial rents remained stable across key centres, but conditions are expected to get tougher this year
Kent statistics: retail and industrial
