Interest in the North West’s commercial property market is on the up according to the latest RICS (Royal Institution of Chartered Surveyors) market survey.
Industrial space outperformed office and retail during the first quarter of 2017 with 34% of respondents reporting an increase in enquiries for the commodity.
Demand for offices also increasing in Q1 2017 with 17% of respondents seeing a rise in enquiries for office space (up from 14% in Q4 2016). However, demand for retail property fell, with only 3% of respondents reporting an increase in enquires.
Industrial space also performed the strongest in terms of capital value expectations, with 40% more respondents anticipating prices to rise over the next three months – the highest reading since Q1 2016.
Space available for occupancy in the region’s retail sector increased during Q1 2017 – the first time since Q1 2016 – with 19% more respondents seeing a rise in available retail space.
Given the demand and supply dynamics, rents are expected see the strongest growth in the industrial sector over the next twelve months, with 68% of respondents anticipating a rise in rents for prime industrial property over the coming year.
Geoff White, RICS policy manager in the North and Midlands (pictured), says: “The shortage of industrial and commercial units is a major issue in the North West and a concern for RICS professionals in the region.
“They have welcomed the government’s intention to develop an industrial strategy across the UK and the focus this will bring to offices, industrial units and commercial sheds.
“Employment land is being lost to residential schemes to fix the housing shortage, but this means opportunities for businesses to start, grow and relocate are shrinking.
“In addition to this, uncertainty in the economy means much-needed speculative commercial development is extremely rare or non-existent without some form of public sector intervention.
“Unless the industrial strategy tackles this, the government’s plans to drive economic growth and improve productivity could be in jeopardy.
“One answer would be to ensure that any future metro mayors would have powers to protect employment land and to develop strategic development plans that would bring together the currently disjointed local and national plans for transport infrastructure, housing and industrial and commercial real estate.”