The facts are that the huge amount of speculative commercial development has not taken place as happened in the late 1980’s (the same cannot be said for high value residential town centre schemes) and certainly the demand for freehold commercial property is still very good.
Truth be told regardless it makes waiting House Conveyancing inquiries in the personalities of numerous and particularly new land business contestants. Occupation of investment properties is not guaranteed and the opportunities to re-let secondary properties in a more bearish market might prove limited. The facts are that some of those companies that have been riding the crest of an economic boom have already had their wings clipped as evidenced by the high profile failures within the technology sectors.
Serviced office provider Gainsborough Group has been named as the nineteenth fastest growing British company in the ‘Sunday Times Virgin Atlantic Fast Track 100’ survey. The Fast Track 100 is described as the definitive league table of Britain’s fastest growing unquoted companies and the final 100 companies were selected from a database of one million businesses. Tenants up and down the country are expected to benefit from more flexible rent reviews after the Government recently accepted the recommendation of the Interim Working Party of Property Industry Organisations which stated that rent reviews should generally be to open market rent.
Jenny Rodericks, Associate Partner in Drivers Jonas’s Landlord and Tenant team states: ‘Any suggested changes to the Government’s code need to be implemented before we see any major changes in the market place, But all parties need to be aware of the choices that may now be open to them and the costs associated with them. Whatever happens, we are lilfely to see more rent reviews in coming years rather than less. Drivers Jonas’s latest West End Crane Survey for Mayfair and St James’s confirms that, despite the economic downturn and market uncertainty following 11 September, the level of development activity in the area has remained constant over the past six months.
It also predicts that the industry should see an increase in the number of deals being undertaken early in 2002. The survey confirms that while there has been a relatively low level of construction activity within the core area, there has been improvement in the amount of completed developments in the past six months. A total of 32,000 sq m (344,400 sq ft) has been built, up from 25,000 sq m (269,000 sq ft) in March. Consequently Drivers Jonas anticipate that there will be little or no over-supply of Grade A stock in Mayfair or St James’s in the foreseeable future.