DEVELOPMENT ADVICE

Admittedly, commercial property development has taken a hammering of late.

Regional statistics tend to show a cyclical development of office, industrial / warehouse and other commercial premises which is largely caused by local market conditiond, changes in planning policy and development finance / investment opportunities.

Lead-in time before physical development takes place can be anything from 1-5 years. To be successful, a development project therefore requires good market analysis, a reliable core team of advisors, steady nerves and some luck.

At the present time, with weak market demand, newly-built property stock is generally regarded as being in over-supply. However, statistics and perception can often quickly be overtaken by events.

In the 1980’s, during another declining market, I was involved with a market analysis of new (speculative) industrial stock within the Leeds planning district. Over 2 million sq ft was identified as being completed and available for immediate use against recent annual take up up of little over 300,000 sq ft. Yet 3 years later, virtually all the available stock had been taken up with very little new coming forward to replace it – hence a sudden market opportunity came about for a new development cycle.   

A complete understanding of changing trends within the business occupiers’ own sectors allied to market knowledge, particularly of opportunities for new development (green field) or redevelopment (brown field) and capital funding / investment is key to the development surveyor’s input.

Whilst the actual process of construction is relatively tightly controlled, changes in legislation – particularly environmental – offer challenges to established practice and new marketing opportunities.

Sustainable regenerative development is the future, but possibly in conflict with occupiers’ aspirations for good neighbourhood, image and motorway access. We shall see.