Agents pick the most significant Deals (for the six months to the end of April 2016)
Clarendon Road, Watford
Type of deal Freehold purchase
Vendor Origin Housing Group
Occupier TK Maxx
Size 1 acre for up to 150,000 sq ft of development
Price £8.5m
Chosen by Ryan Dean, partner, Knight Frank
My choice of recent occupier transaction is the purchase of a site, opposite Watford Junction railway station, by TK Maxx. The site was owned by Origin Housing which was considering residential development there. However, more recently, it has been tracked by a number of commercial office developers, all aware that a new office building in this location would let quickly, given the lack of good-quality office space on Clarendon Road. TK Maxx has grown organically in Watford over the past few years and many of its office acquisitions have been reactive. It is interesting, therefore, to see an occupier such as this buying a site so that it can control its own destiny. It also continues a trend we are seeing elsewhere with the likes of Centrica in Staines and Lidl in Tolworth adopting a similar strategy. Owning freeholds will enable these occupiers to take space when they need it and develop offices that suit their businesses.
401 Grafton Gate, Milton Keynes
Type of deal Office lease
Landlord Picton
Occupier Mölnlycke Health Care
Size 6,500 sq ft
Rent £17.50 per sq ft on 10-year lease with five-year break
Chosen by Sasha Lousada, consultant, Brown & Lee
The Mölnlycke Health Care deal at 401 Grafton Gate completed the letting of the 60,000 sq ft office building and represented the successful culmination of an asset management strategy that started with a comprehensive refurbishment by the building’s landlord, Picton. The deal also demonstrates the re-emerging strength of Milton Keynes – recognised as a centre for growth by the likes of think tank Centre for Cities. Office availability in Milton Keynes has fallen substantially over the past two years, partly as a result of several office-to-residential conversions. At the same time, there has been a gathering recovery in the local occupier market. These two factors have combined to create heightened demand for high quality buildings that do become available. The space offered at 401 Grafton Gate provides a good example of this trend, letting well both to existing tenants which have chosen to take more space, and also newcomers to Milton Keynes such as Mölnlycke Health Care.
Pinehurst, Farnborough Business Park
Type of deal Office lease
Landlord Harbert Management Corporation and XLB
Occupier Time Inc UK
Size 30,000 sq ft
Rent In line with quoting rent of £27.50 per sq ft
Chosen by Matt Willcock, director, national office agency team, CBRE
In what was the largest letting in Farnborough for five years, the first key tenant was agreed at Pinehurst, where Harbert Management Corporation & XLB secured Time Inc UK. The publisher acquired 30,000 sq ft at Pinehurst II, the speculative office development at the heart of the park, into which it has relocated around 300 employees who work on its specialist brands, including Horse & Hound and Country Life. Most of these staff were based at its former headquarters at the Blue Fin Building in Southwark. The company was attracted by the business park’s environment, amenity offer and connectivity and its decision to relocate there provides a high-profile example of an occupier facing affordability and supply issues in central London. We expect to see this trend continuing through 2016 and 2017 with further such commitments to space outside core central London resulting in a continuation of the rental growth we have seen during 2015.
Big in Bicester
Albion Land unveiled plans for Link 9, a 520,000 sq ft industrial and warehouse scheme at Bicester in Oxfordshire – the town’s first large-scale development for 15 years.
Tall in Milton Keynes
Milton Keynes Development Partnership announced the selection of Sterling Property Ventures to deliver MK’s tallest high-rise development, on Midsummer Boulevard.
Forum for sale
M&G appointed Knight Frank to sell The Forum, its 250,000 sq ft cluster of five buildings at Southampton’s Solent Business Park, for in excess of £42m – a 7.5% yield.
Woodlands expansion
Barwood Capital submitted a planning application for 150,000 sq ft of office buildings on a 12.5-acre site at Woodlands Business Park in Milton Keynes, which it acquired last year.
Full steam ahead for museum
Plans were approved for the £4m Ashford International Model Railway Education Centre in Kent, a 30,000 sq ft museum, which counts Roger Daltrey, Jools Holland and Pete Waterman among its supporters.
Oxford out of reach
Research by Lloyds Bank revealed that Oxford had the least affordable homes of any city, with average house prices 11 times gross salaries.
EG gauges the trials and tribulations of the South East property market
Vital statistics, facts and figures for the South East
30%
increase in office take-up across the South East in Q1 2016, at 973,000 sq ft, 10% above the 10-year average.
52%
house price rises along the ‘Elizabeth Line’ Crossrail route since construction began, compared with an average of 30% for England. Average increases of £133,000 expected until trains start running.
18.1%
population growth of Milton Keynes from 2004-14, compared with 7.8% for the UK, making it one of the fastest-growing cities in the UK.
£325m
AEW’s purchase of SEGRO’s Slough office portfolio, the largest South East transaction in two years.
136
new office enquiries for the Thames Valley in Q1 2016, 11% up on the same quarter 2015 and the highest Q1 figure ever.
Sources: Knight Frank, Zoopla, Rightmove, Bidwells, LSH, IP Global
40%
the proportion of customers from outside the UK for Oxford’s tech and digital businesses
£0.4bn
volume of office investment transactions in the South East in Q1 down 46.5% on Q1 2015
• Sources: Knight Frank, Zoopla, Rightmove, Bidwells, LSH, IP Global, Tech Nation 2016 , Colliers International
