| news RO INVEST IN
he RO is pleased to announce that they have completed the purchase of 1 Dorset Street in Southampton from Aberdeen Standard Investments for £5.2 million. This brings RO’s total of sales and acquisitions to in excess of £60 million over the last 15 months.
T This is the third major acquisition the
RO has made in Southampton, bringing its total investment in the City to over £16 million, following the purchase last year of Waterside Place, located on the marina and a short walk from West Quay, acquired for £7.6 million; and West Park House which the RO purchased from Lanyon Quay Ltd for £4 million in April. All acquisitions were made through the RO’s wholly owned subsidiary RO Real Estate.
1 Dorset Street is a prominently
located and prestigious office building within central Southampton. The property is one of the newest office buildings in a City with diminishing levels of Grade A supply. The property is located in the established central business district, within close proximity of both the prime retail shopping area of West Quay and half a mile from the station.
SOUTHAMPTON
M&G: MARKET SHOWS NO SIGNS OF SLOW DOWN A
ccording to M&G Real Estate, parts of the UK commercial property market will remain strong despite the uncertainty surrounding ongoing Brexit negotiations with the UK economy softening only modestly and unemployment at its lowest in 42 years.
M&G Real Estate’s UK Outlook research suggests that the industrial and logistics sector will continue to experience strong rental growth due to the limited availability and high demand for industrial space. This trend is accelerated by the ongoing shift to e-commerce with retailers such as Amazon, Lidl and Aldi increasing their supply chains to fulfil demand for quick deliveries. Available stock is being squeezed even further as urban distribution centres are being snapped up to cater for this demand but the sector is responding innovatively with the introduction of multi-storey assets, subterranean logistic units and mixed use space such as ‘beds and sheds’ which amalgamate residential and industrial space under one roof. M&G Real Estate predicts that office space in the regions could experience rental growth of 10 percent in the next five years as a result of the lack of Grade ‘A’ office space, infrastructure projects such as HS2, and the regeneration of city centres.
GREAT DEAL DONE C
axtons is pleased to announce the successful conclusion of a £7.6m (ex VAT) deal for one of its investment clients. This prime retail property is located in the south west
London suburb of Richmond upon Thames, just 8 miles south west of central London. It is let to the fashion retailer Massimo Dutti until 2024 (with a review in 2019), for a current rent of £325,000 per annum providing an initial net yield of 4%. Neil Chatterton, Managing Director of the Kent based independent firm of chartered surveyors, has represented the purchaser – a Hong Kong based property company - since the 1980s.
Neil said: “This is the
second Richmond property that we have acquired for our client who has an interest in prime property in and around the London area. The first, purchased earlier this year, is positioned in the busy shopping area of The Quadrant, and was obtained at a purchase price of £2.35m. The sale was handled by central London agents Lewis & Partners and first presented to the client at the end of the summer.“
The wealth of the borough is evidenced in an above average spend per head of population and corroborated by positive house price growth, which in 2015 was 32% above the Greater London average. Prime property values have also risen by an estimated average of 105.4% since 2007. Purchased from a Trust, this elegant, freehold, mid-terrace property is of traditional brick construction, set over three floors with Victorian style sash windows and provides 6,432 ft2 Contact Neil Chatterton at
nchatterton@caxtons.com
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Central London offices remain challenged due to the downside risks from Brexit negotiations with some financial institutions announcing plans to cut or relocate London-based staff. However, the city’s job market is becoming increasingly diversified with a growing presence of operators offering innovative office space, creating long-term opportunities for landlords.
The Private Rented Sector (PRS) is proving its value as a defensive asset class and is benefiting from heightened uncertainty. With rock bottom interest rates, limited supply and ongoing demand, house prices will remain unaffordable for many, prompting people to rent for longer. With a substantial development pipeline contributing to new space, M&G Real Estate’s rental projections for the central London PRS market remain negative, but predicts a continued rise in rental growth outside of Central London.
Richard Gwilliam, Head of Property Research, M&G Real Estate comments: “While there are clear risks related to the uncertain political backdrop, we need to be ready to capitalise on the opportunities that will emerge. We believe that ongoing risk aversion and yield expansion for non- core stock creates opportunities”.
NEW CHICHESTER CENTRE W
orkspace provider Basepoint Business Centres Ltd has announced plans to open a new Chichester business centre next spring, in partnership with Chichester District Council. The new facility will be known as Chichester Enterprise Centre
and located on the Terminus Road Industrial Estate. The centre will house 82 units that provide a range of workspace on flexible terms, including serviced offices, studios and workshops ranging from 150 to 700 sq.ft, as well as Virtual office services. Business support facilities including a reception, breakout area, bookable meeting rooms and high-speed internet, will also be provided. The centre is located just off the A27, giving easy access to
Chichester city centre, as well as Portsmouth, Southampton and Brighton. It is also located just ten minutes’ walk from Chichester railway station, which offers direct rail access to London Victoria via Gatwick Airport.
£11.3M SOUTH EAST LONDON SITE B
uccleuch Property has completed a forward sale of its £11.3m Axion Building in Belvedere to Orchard Street Investment Management, who were acting on behalf of St James’s Place UK Plc. In conjunction with Wrenbridge Land, Buccleuch acquired the site unconditionally and obtained planning permission for a standalone 68,072 sq.ft industrial development. The Grade A warehouse is ideally situated in close proximity to the Docklands, Central London and the M25 making it strategically placed for both regional and urban distribution. Existing occupiers within close proximity to the site include Amazon, Ocado, Asda, Tesco and Lidl. The high quality development is designed to deliver a BREEAM
“Very Good” rating and its combination of low running costs and high environmental sustainability is likely to make it very attractive to potential occupiers. Works at the Axion building are due to start in December with practical completion expected by Summer 2018.
COMMERCIAL PROPERTY MONTHLY 2017
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