Commercial Property agents in Hull say recent sales of large industrial property sites across the region reflects the ‘significant reshaping of businesses’ as the country moves towards the end of more than a year of lockdowns and restrictions.
Garness Jones has completed a string of sales in the opening quarter of 2021 – totalling well in excess of £4million – and says the business being done reflects a market in which many companies are now adjusting following the events of the past 12 months.
Specialist Chris Hyam says the market is currently split between those choosing to dispose of assets no longer required to improve finances, those keen to expand on the back of a year of growth and others still assessing the full impact of lockdowns on their profitability.
He cited the recent sales of large industrial sites in Hull, in Dalton Street and Wiltshire Road, as an example of significant market demand for larger industrial premises.
They each saw businesses sell off assets which had become surplus to requirements, allowing the buyers to expand their current operations.
Mr Hyam now expects to see ‘an exceptionally busy market’ when measures put in place to support businesses through the challenging past 12 months come to an end, such as rent breaks and Government loans.
“This sector is usually driven by companies outgrowing premises and moving into bigger facilities, and those sadly who find themselves in a position where they need to sell,” he said.
“There has been less properties on the market over the past 12 months, but I expect there will be a clear shift as the various packages of financial support from the Government, and things such as rent breaks, come to an end this year.
“In some cases the limited availability, combined with continuing high levels of demand, has led to industrial properties commanding a higher price and increased competition, which has been good for sellers.
“This was reflected in two industrial property sales in Hull, worth £1.5m each, being completed in the first quarter of the year by our team.
“The property in Wiltshire Road, which is a modern storage and distribution warehouse, went through within seven weeks of being placed on the market. There were five interested parties in that deal and in the end it went to the best offer.
“The final three quarters of 2020 was frustrating for many business owners looking to secure new commercial business premises to expand and grow because there was simply not the usual flow of properties coming onto the market.
“However, we are now seeing many businesses reshaping for the future and identifying properties no longer needed, which is positive news for those needing somewhere to grow and expand.
“The face of business will change a lot in the coming months and that will make the commercial property market busy.”
Increased demand for warehousing, storage and distribution facilities as logistics industry grows
Mr Hyam says Garness Jones has inevitably fielded an increase in enquiries from businesses in the logistics sector over the past 12 months.
“We have seen interest from businesses looking to open new storage and distribution facilities in regions to meet increased customer demand,” he said.
“We’ve also fielded many enquiries from companies in the caravan industry who have seen an increase in demand for their products given more people are likely to holiday at home this year.
“This is in part due to increase in orders but also because they want to ensure a Covid-secure environment for their staff, and so have had to consider extra premises to run enough production lines. Some local firms have already expanded in this way.”
Mr Hyam says the market has been similarly affected across Hull and East Riding, North Yorkshire, North East and North Lincolnshire.
“All areas have been impacted in the same way over the past year, but like in Hull since the turn of the year, we have started to see more movement in other areas and recently completed significant sales in Hunmanby and Woodhall Spa. Industrial stock doesn’t tend to stay on the market long anywhere at present.”