Prices set to reflect shortage of supply for industrial units in Worcestershire

PRICES for new industrial properties across Worcestershire will set new records in 2017 as the shortage of industrial space on the market continues to restrict supply, property agents have predicted.
 
John Dillon, managing director of commercial property consultancy GJS Dillon – which has offices in Droitwich, Worcester and Bromsgrove, said the situation would affect both new and existing properties.
 
“Demand is far outstripping supply for industrial units between 3,000 sq ft and 40,000 sq ft, as manufacturing and distribution businesses in the county continue to invest in new premises and show increasing confidence in the post-Brexit economy,” said Mr Dillon, whose firm has disposed of more than 80,000 sq ft of industrial property in the last three months.
 
“There is very little space coming onto the market at present, and this is unlikely to change in 2017, as few speculative developments are planned.  Even at Worcester 6 only one speculative unit of 45,000 sq ft has been announced.”

He said as with any commodity in short supply, then prices would reflect the lack of availability.
 
“This on-going shortage is placing upwards pressure on prices.  Next year (2017) new build industrial units up to 5,000 sq ft in the right location in the county will reach £120psf, while similar units to rent will break the £7psf barrier,” he added.
 
“Although they are not going to achieve the same levels as for new builds, prices of good quality second hand units in established business park locations are increasing quarter on quarter, and when they do become available are highly sought after, frequently going to best and final bids.”

With uncertainty continuing to surround Brexit, he said there were still opportunities for freeholders bringing their industrial property to market.