Office space vacancy rate falls on South West Business Parks

GVA report says South West maintains a steady position as nationally take up increases by 8% in H1 2011

Article posted: 07 Sep 2011

Bristol and Bath Science Park continues to be the focus for business park activity in the South West region, according to a new report from property adviser GVA on occupier activity on the UK’s business parks.

170,000 sq ft of office space in the South West and South Wales region is currently under construction, well below the current five year average. Of this, 120,000 sq ft is underway at offices in Bristol and Bath Science Park (pictured), with very few new schemes going ahead elsewhere except on a pre-let or pre-sale basis.

Commenting in the GVA Business Parks Review for Summer 2011, Ben O'Connor, regional head of office agency for GVA in Bristol, says: "The amount of office space available on the region's business parks has fallen by just over 10% on the previous six months, giving a total of just 1.4m sq ft currently available. Since the supply pipeline remains constricted, and as a consequence of sustained occupier demand, we have also seen the vacancy rate fall. Compared to other UK regions, the South West is however, maintaining a steady position.”

In Wales, Admiral Group agreed to sub-let 40,000 sq ft of office space at Swansea Enterprise Park on a short term arrangement as it looks to consolidate its operations in the city.

Nationally, a total of 1.6m sq ft of take-up was recorded in the first six months of 2011, an increase of 8.0% on the previous six months but 23.8% below the current five year average.

Prime out-of town rents for office space in Bristol remain at £21.00 psf, Exeter £18.00 psf, and Plymouth £15.50 psf. For office space in Cardiff rents are £15.50 psf, and in Newport £14.00 psf.

The report expects the recovery of the business parks occupier market to gradually improve, but given the importance of public sector demand (it accounts for around 20% of business park floorspace), the impact of spending cuts could be significant.

A copy of GVA's business parks review is available at http://www.gva.co.uk/research/offices/

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Posted by Janet