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8/8/2019 The state of play, property another year on - LSH seminar slides
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CAPITALISING ON CURRENTMARKET CONDITIONS
Guy GilfillanHead of LSH Yorkshire
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POSITIVE DEVELOPMENTS
RETAIL INDUSTRIAL OFFICE
350m 5m sq ft Largest
northern officedeal 2010?
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MARKET OPPORTUNITIES
Retail: Convenience sector
Healthcare: Residential / healthcareprovision for the elderly
Education: Private schools Public sector: Relocation for efficiency
gains
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CURRENT CONDITIONS
8/8/2019 The state of play, property another year on - LSH seminar slides
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MARKET OPPORTUNITIES
Sectoral changes
Supply
Innovation
Environment
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THE OFFICE MARKET
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THE OFFICE MARKET
City Centre Office Take-up
472,586
585,844
513,773
731,419
539,113
337,694
563,785
621,405
570,208
499,502
592,639
471,199
246,443
270,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Year
ft2
Average take-up: 519,000 ft2
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THE OFFICE MARKET
OPPORTUNITIESShift to core CBD:
Across the UK
Drivers staff & transport
75% of current enquiries Location, location, location
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THE OFFICE MARKET
OPPORTUNITIESDemand for quality:
Previously cheap n cheerful
2010 quality & good value
80% of enquiries Grade A/B+
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THE OFFICE MARKET
OPPORTUNITIESLack of stock:
No new build
Quality of the stock
Core CBD availability< 2.5 yrs supply
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THE OFFICE MARKET
OPPORTUNITIESLease events:
850,000 sq ft (2010 2015)
5 x 80,000 sq ft+ (2014)
Downsizing Will tenants move?
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THE INDUSTRIAL MARKET
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THE INDUSTRIAL MARKET
OPPORTUNITIESRecent take-up:
5m sq ft take-up last 2 years 2 years supply remaining
Less in reality
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THE INDUSTRIAL MARKET
OPPORTUNITIESOnline retailing:
Major distribution driver Recently ASOS, Amazon, Next
Directory, Asda & Ocado Number of major online retailer-led
requirements
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THE INDUSTRIAL MARKET
OPPORTUNITIESManufacturing:
Expert-led economy 10% of regional economy
Rolls-Royce & Forgemasters
Innovation:
Universities
Waste to energy
Energy
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THE INVESTMENT MARKET
OPPORTUNITIES First transaction yield
increase for 18 months
Transaction levels slow inQ3 still highest for 2years
Focused on CentralLondon Office Market /prime assets
Secondary / tertiarymarkets soft
2001 2002
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THE INVESTMENT MARKET
OPPORTUNITIES Institutions are the
most active buyers Overseas investment
pattern less
predictable
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OPPORTUNITIES QUASHED
Lack of finance
Shortage of available sites & premises Lack of economic growth
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CONCLUSION
Most high-profile property
entrepreneurs created the opportunityin a bad market & capitalised on itlater in the cycle.
When the market turns, it will improvemuch more quickly thancommentators expect.