It is widely accepted that the office market has been the hardest hit of all the commercial property sectors during the recession and with the exception of London and ‘hot-spots’ such as Cambridge the regional office market has struggled with a significant drop in demand and consequently a fall in values.
At the peak of the market prime office rents in Northampton were achieving £17.00 per sq ft . With headline rents now at circa £12.00/£13.00 per sq ft and a perceived over supply of stock in the market it would seem that there is a long road ahead of us before we get back to the rentals levels being achieve in 2007. Before any rental growth can even be considered however we need to see an increase in demand. If the balance of consistent and steady demand outweighs supply then we might just dare consider the prospect of some limited speculative office development.
It is encouraging to report therefore that over the past 12 months we have seen a noticeable increase in demand in Northampton for good quality office accommodation in both town centre and out of town business park locations. We have long been suggesting that there is a shortage of good quality industrial stock in the market but we are now fast approaching a point where the same will apply to the office market. An example of that demand is our recent success at Park House on Pavilion Drive, Brackmills. This 43,000 sq ft pavilion style building offers a range of suites all of which have been fully refurbished to an extremely high standard offering raised floors, new suspended ceilings with concealed lighting, carpeting throughout and the entire building benefitting from comfort cooling throughout. Acting on behalf of the Landlord , Drake Commercial have recently concluded negotiations with Grant Thornton, an existing occupier in the building , to take an additional two suites totalling 4,025 sq ft and 3,900 sq ft respectively. Advanced Business Software and Solutions Limited, also an existing occupier of Park House have committed to remain in the building and have taken an additional 2,000 sq ft suite on a new 5 year lease. There is now only one single suite of 2,430 sq ft left in the building which is located on the ground floor and has the benefit of 9 car parking spaces.
Elsewhere in Northampton we have over 30,000 sq ft of good quality office space currently under offer, all of which to local business who are looking to expand and remain in Northampton. We are some way off seeing speculative office development in Northampton but the early signs for growth in this sector are extremely encouraging.
For further information contact Nicholas Roberts