Lease Advisory Market Update
Thursday 27 April 2023
Flude Property Consultants are delighted to share with you our most recent lease advisory update. Acting on behalf of both landlord and tenant clients, our dedicated professional services team have concluded a number of rent reviews, lease renewals and re-gears.
In recent months, we have seen activity in the market stabilise as an element of confidence returns amongst occupiers and landlords. Furthermore, despite the overarching ‘cost of living crisis’, strike action across multiple sectors and the pressures of inflation, the market sentiment feels less downbeat than it did towards the end of 2022.
It is yet to be seen whether industrial rents will continue to increase, although there is evidence of rents beginning to plateau in some locations. In East and West Sussex, rents have remained robust, and the genuine lack of supply has ensured demand remains high. However, Hampshire in particular has benefitted from good levels of speculative redevelopment over the past two years, and the increase in available accommodation has seen rents soften as a result; particularly for ‘older’ stock.
In terms of offices, the market remains ‘mixed’, as Prime high specification space with good Environmental, Social, and Governance (ESG) standards attracts occupiers and rental growth. That said, Secondary office accommodation continues to weaken, further indicating the emergence of a two-tier market in this sector.
In our experience, the retail and leisure market as a whole remains the weakest of the three core sectors. For High Street premises, there are consistent levels of occupational activity for attractively priced properties, but rents have fallen quite considerably in certain towns. On the other hand, rents for cheaper (more Secondary/Tertiary) retail premises, and especially those which benefit from some form of Small Business Rates Relief, have remained robust.
