The great glowering sheds of Thurrock and Dartford, outside the M25 are going slowly. The little sheds on the inside of the motorway ring road are flying out the door. Is this because shed users are moving away from areas in the immediate Olympic catchment? The answer is probably not yet – but developers are pinning some of their hopes on that happening soon.
ProLogis has seen two lettings on its schemes in West Thurrock and Dartford. A 670,000 sq ft pre-let to Sainsbury’s at The Bridge, Dartford, was one; a 110,775 sq ft letting to Coutts Retail at ProLogis Lakeside DC1, West Thurrock, the other.
Another big letting in West Thurrock was Ikea’s deal to take 58,000 sq ft at Lattice Pension Fund’s Gateway 25. Also in Thurrock, Sleep Depot has taken 49,000 sq ft from Industrial Property Development Fund.
A run of lettings of mid-sized property within the M25 makes those with the remaining empty big sheds outside look on jealously. The A13 corridor has been especially busy.
Last year, Cosco Logistics took 31,000 sq ft at the Zenith Estate in Basildon. The unit went on a ten-year lease at a reported rent of £6.50 per sq ft.
On the inside of the M25, ProLogis let its Circular 13 scheme in Barking: 96,693 sq ft to Moss Bros. Asking rent was £7.75. This is now an average asking rent for this size of building. ProLogis wants the same money for its 272,695 sq ft ProLogis River Road scheme in Barking and its 193,000-sq ft ProLogis Aztec 406 scheme in Edmonton.
In Dagenham, East London, Ravenbourne and Standard Life Investments have agreed two new leases, totalling 87,784 sq ft at Thames Gateway Park.
They have granted Britvic Soft Drinks a 10-year lease of the 65,233 sq ft unit 2 at £7.10 per sq ft. Britvic is relocating its warehouse function from nearby Beckton to make way for an extension to its manufacturing plant.
Removals company Bishop’s Move has taken a 15-year lease of the 20,276 sq ft unit 6 at £7.40 per sq ft. This acquisition provides a new strategic storage facility for Bishop’s Move to service its city-based clients.
The units are part of 405,466 sq ft of speculatively developed industrial/warehouse accommodation that comprises phases 1 and 2 of Thames Gateway Park. Agents for the developers are Edwin Hill and GVA Grimley. Harvey & Co advised Britvic. Edwin Hill also advised Bishop’s Move.
To date, 88 per cent of the scheme has let. Other lettings there include 154,638 sq ft to British Bakeries; 53,475 sq ft to Antalis and 59,104 sq ft to Securitas. Three units, providing from 15,891-31,802 sq ft remain. The London Borough of Barking and Dagenham has granted planning permission for phases three and four which comprise up to 371,940 sq ft on the remaining 19.04 acres.
Edwin has also been active, this time with Colliers CRE advising Orchard Street Investment Management on the remaining unit on Edisons Park at Crossways Business Park, Dartford. Services company Centrica has taken the 27,468 sq ft (2,552 sq m) distribution/production unit for a gas fitters’ training centre on a 10-year lease, paying a rent of £7.25 per sq ft. GVA Grimley represented Centrica.
The deal with Centrica means that the speculatively built Edisons Park is now fully let, following lettings last year of 27,500 sq ft to shirtmaker Thomas Pink and 35,000 sq ft to Dachser Transport UK, part of German logistics company Dachser. Other tenants on the five-unit Edisons Park development include US pharmaceuticals company Remel Europe (45,000 sq ft) and printing and mail fulfilment house Howard Hunt Direct (25,000 sq ft).
For anyone interested in how the development market will go over coming years, one to watch is King Sturge, Aukett Fitzroy Robinson and Colin Buchanan’s East London research initiative “Ahead of Time: London’s Emerging Markets East of the Meridian”.
It aims to look at the impact that £3bn of investment in transport will create in terms of new investment opportunities in London, east and south east of the Greenwich Meridian line. How will property values rise across each of the main asset classes? How will new development in this area engage with local communities and embrace the ideals of CABE?
Launched at MIPIM 2006 by Joanna Averley, deputy chief executive and director of enabling, CABE and Jeff Channing, director of Thames Gateway and Olympic Delivery, ODPM, the initiative brings together the multi-disciplinary expertise of the three consultancies to identify the future mixed-use development hot spots in the area. The collaboration will apply expertise in master planning, transport design, planning, asset value and transport opportunities, to provide in-depth data and research on key areas of the capital over the next 15 years and beyond.
Angus McIntosh, head of research at King Sturge says: “In all likelihood, the most significant future opportunities for property investors and developers in our capital city will be in the East. There could even be, for example, the potential for wise investors to receive double the capital growth of the London average and to receive total returns of up to a third higher than in the West End.”
And Andreas Markides of Colin Buchanan consultants says: “Understanding transport changes is the key to unlocking development opportunities over the next 15 years.”