Some 2014 Predictions
We asked around the office for some of our tenant’s predications for the year ahead. Here are a few of them:
1) Investment – Yield Compression
Peter Wood of Harris Lamb’s investment department feels an inevitable compression of investment yields due to ‘school boy’ supply and demand economies.
2) Land Values Increasing
Andrew Lamb believes the higher demand for class B8 warehouse and distribution space coupled again with a supply imbalance is a reason for increasing land values in 2013 and this continuing into 2014. Big sites are worth more than smaller sites too.
3) Rental increased of Class B8 units.
Not only does Tom Morley of Harris Lamb’s agency team believe rents will harden (increase) but ProLogis also seem to be predicting prime B8 rentals increasing by 20% in the next 4 years.
4) Speculative Development
SME’s driving new build speculative space is Neil Slade’s prediction. As one of Harris Lamb’s senior agency team Neil believes new build speculative schemes will start making a comeback in 2014 “across the sectors”.
5) Energy Saving
Paul Wells Head of Building and Project Management believes a new greater targeted focus on energy saving and efficiency in 2014 is inevitable, “with new Part L Building Regulations” due in April this will be the main focus for changes.
“We have to be more efficient and everything Government does is driving this in the construction industry”.
6) Rating incentives to help drive Retail renaissance on the High Street.
Erich Gutt from the Rating team says the stimulus likely to come from the recently announced changes to the rating legislation for shops that have been empty for 12 months or more will see help for some of the beleaguered High Street across Britain.
“It has to help” says Erich, this is a big issue and shows Government is taking empty property far more seriously.