Diminishing Grade A stock leads to property surge
A lack of top class office space in East Midlands cities is causing a surge in property deals, an industry expert has told Insider. Matthew Robertson, surveyor at property consultant King Sturge in Nottingham, has overseen a raft of major property deals recently, culminating in the sale of the 22,500 sq ft Huntingdon Court development this week.
He said: “There is latent demand within the Nottingham office market which is a result of the lack of high quality office supply. There is no true Grade A space within the city centre, a trend which is likely to continue.”
Robertson said that it is a similar situation region-wide, with cities such as Derby having no Grade A office space in the centre. He said that companies are being forced to take space out of town and that there is a backlog waiting for top level city centre space. Only Leicester, with Grade A office development Colton Square, goes against the trend.
He added: “Most are occupiers with local roots. They are professional firms occupying substandard, inefficient space which is unable to satisfactorily accommodate their requirements.
“The resurgence is likely to continue as realistically priced, good quality second hand buildings come to the market. There are still a number of companies’ which King Sturge is aware of, with around one million sq ft of lease events in the next three years. These occupiers are effectively waiting to react to the right building coming forward.”
Robertson was part of the King Sturge team which completed the sale of Huntingdon Court in Nottingham. The building was sold to the Nottingham Building Society (NBS) and will accommodate 180 NBS staff.
The need for Grade A office space comes after Mike Taylor, director of regeneration at Nottingham Regeneration, said there was a “major issue” with Nottingham’s use of secondary office space.
At an Insider breakfast event earlier this month, Taylor said: “There is a vast supply of secondary office space in Nottingham at the moment, much of which has no viable use.”
Taylor said: “The secondary office stock in Nottingham is a major issue facing the city. It’s a matter of what can be done to these buildings. We’re working with agents and the technical side of the property industry to put a case forward as to how these buildings can be put to more profitable use.”
