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Retail take-up flattens property barometer

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Regent Street SwindonRegent Street SwindonA lack of demand for retail premises has made the demand for commercial property look flat, although other property sectors are performing well.

Those are the findings of the latest quarterly report from the Royal Institute of Chartered Surveyors, whose property market survey showed headline demand at zero for the first three months of 2018.

But Swindon property agent Andrew Kilpatrick of Kilpatrick & Co, who contributes to the report, said: "This masks significant differences across the 3 main sectors of the commercial property market, with demand for industrial/warehouse space continuing to rise solidly.

"In the office sector, office demand picked up, albeit marginally, for the first time since Q1 2016.

"However, demand for retail space further declined and at an accelerating rate and is the weakest since 2009, according to the survey.

"At the same time, the supply of retail property on the market has increased, resulting in landlords having to offer greater incentive packages to secure lettings, for the fourth consecutive quarter.

"In the office sector, supply has remained steady, but fallen again in the industrial/distribution sector.

"And in the investment market, demand rose for the seventh successive quarter, albeit at a slower rate than previously, with demand increasing strongly for industrial assets, marginally for offices and falling in the retail sector."

Locally, the property market has seemed subdued due to economic uncertainty, said Andrew.

"However, good interest is reported in the speculatively built 217,000 sq ft warehouse at Symmetry Park on the new 100 acre development east of Swindon off the A420."

In the first quarter of 2018 toy retailer Toys R Us closed down and House of Fraser announced it would be closing stores in a bid to stay afloat, while Sainsbury's and Asda announced a shock merger. Poundland announced the closure of 100 stores, while Debenhams dropped by 85 percent.