Our Directors present their views on the future of the office, industrial and land markets in 2022...
“The office market remains very competitive, especially for premises that have a high specification and therefore represent better value, and I don’t see this diminishing in 2022,” explains Jason Hercock. “What we’ve seen recently is businesses reflecting on how they use the space they occupy and to what extent it’s fit for purpose. Decisions that may have been parked last year are now being made with more confidence, as firms have a year’s experience and working patterns have emerged. How this translates is that there is a definite need for designated office space, somewhere tangible that ensures the identity of a business is retained. Out of city spaces, with open plan, flexible layouts and private parking are hugely desirable, perhaps also as they are accessible without commuting on crowded public transport. Similarly, small to medium sized offices will remain sought-after, as firms look to downsize and provide environments better suited to flexible working arrangements.”
Andrew McFarlane Holt expects the industrial sector to perform equally strongly. “Demand is completely outstripping supply and this won’t change over the next 12 months,” he said. “Rents and capital values are also increasing – both indications of a healthy 2022. The industrial/logistics sector has been one of the big beneficiaries of the pandemic, particularly for businesses specialising in light manufacturing, home improvements, technology and online retail. What’s happening now is new industries such as TV and film production, streaming services and even modular home developers are looking to secure high volume space and this means good quality stock is hard to find –more speculative development is urgently needed. On the positive side, so much development in this sector, especially in the Midlands with the expansion of Magna Park, has considerably strengthened the local economy and created ample employment opportunities, which we expect to continue through 2022.”
The land market faces a similar scenario, as Trevor Wells outlines: “Appetite for land of all types is extremely high and prices have performed well as available parcels are in such short supply. Land continues to be seen as a safe investment, especially as Capital Gains Tax was not altered in the Autumn Budget. Strategic land is much sought-after due to increasing pressures for housing stock and industrial uses, and commercial land is now actively competing with residential land. We’re still waiting to see the full impact of the Planning Bill that was announced in The Queen’s Speech so hopefully further details on the new categories for land will emerge in 2022 and accelerate viable options.”