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Commercial Property Register

March - June 2018

www.compropregister.com

A plea for increased commercial and residential development to sustain

the strong market in the North West has come from Savills.

It noted that demand from businesses and residents had grown

steadily and looked to continue, despite “the destabilising influence of Brexit

negotiations. But commercial and residential property supply must diversify

and bring forward more property across all classes if it is to meet growing

demand and maintain competitiveness.”

Toby Haslam of Savills commented: “If Manchester wants to meet its

growth aspirations, it needs a broader range of developments to appeal to

the varied demographic.”

Another Savills view comes from John Evans who said: “Demand for

Grade A offices is so high that it’s spilling into secondary stock and pushing

rents up. This is expected to drive future demand for services, offices and

light touch refurbishment in the short term. Longer term, we expect to see

the core office market expand into areas previously seen as fringe such as

Oxford Road, Ancoats and the Irwell corridor”

BUILDING

blocks

A magic formula continues to work in Man-

chester as it powers ahead as a dynamic glob-

al city.

A key to success now lies with innovation and

a significant research and development base –

which is exactly what Manchester has. That is

indicated by the fact that it scores so heavily in

the league table of cities that receive tax relief

for research and development.

A report from specialist tax firm Catax logged

Manchester’s tax relief claims as four times

higher than its nearest rival at 1,140 claims in

a year with a value of £75 million. Next on the

list is Edinburgh with 290 claims. However, Catax

also said there is a general lack of awareness

about what constitutes a valid tax claim.

The basis for judging the performance of

Manchester is a wide one with Lambert Smith

Hampton (LSH) reporting that Manchester and

Salford is well ahead of other UK regions in the

expanding market of build to rent (though

behind London). LSH makes the point that:

“The rapid growth of build to rent has led to it

increasingly being recognised as a separate

asset class.”

Ian Scott of LSH commented: “Manchester,

unsurprisingly, tops the charts for the North

West, driven by the scale of the young

population and demographic suitability on

the ACORN profiles as opposed to affordability

constraints. The same is also true of Salford and

Liverpool.”

Another peg in the firm commercial market is

the strength of hotel investment in Manchester,

which Savills said is the highest of any regional

city. Last year, reported Savills, there were nine

hotel deals totalling £178.55 million, which was

52% higher than Edinburgh in second spot.

The dominant investors were from overseas

in 2017, which continued the overseas

expansion of the investment market in the

North West.

Tom Cunningham of Savills said:

“Manchester is a truly global city with high

levels of recognition thanks to its international

airports, forward thinking city council, strong

visitor numbers and numerous sporting,

business and leisure events every year. The

strength of the hotel investment market is a

reflection of this, and we expect this to

continue with another robust year.”

In fact, the commercial property market

continues to power ahead in the North West,

said Harry Skinner of Avison Young, which has

recently bought WHR, another agency. Apart

from the buoyant office market in the city

centre, Avison Young has the 1,858 sq metres

(20,000 sq ft) Atlantic House in Birchwood,

Warrington, which Skinner said is “a strong,

well-established business park.”

IN BRIEF

MItty

Group has raised £1.84 million from Assetz Capital to fund

two new mixed-use schemes in Merseyside to transform a

360-year old former barn and row of Victoria townhouses for a

residential and leisure development. The residential space is for

students and the ground floor will be a restaurant. Adam Mitty

commented: “We pride ourselves on restoring listed buildings to

their former glory.”

R & D

groove

NEWS