With the region firmly establishing itself as a hub for 21st century businesses, Bath has seen a 19% increase in office space take-up, largely attributed to the media and tech sectors.
According to new data released by Carter Jonas at the launch of its Bath and South West Commercial Edge research report, transactions on over 114,929 sq ft of office space were completed last year compared with 96,400 sq ft in 2017.
Over the past decade, take-up across the city averaged just under 100,000 sq ft per annum.
Philip Marshall, Partner at Carter Jonas, said, “It is encouraging to report such a strong year, with the amount of space transacted reaching towards the top of the ten-year average. The city, however, continues to suffer from a lack of quality supply and whilst our research illustrates demand from a wide range of occupiers, actual take-up is being suppressed and causing occupiers to look elsewhere.
“Businesses are placing greater emphasis on the quality of a building, and its environment is now more important than location alone. This is making it increasingly difficult to let some lower quality space, as, despite high levels of overall demand, many occupiers are looking for open plan space on a single floor. One consequence is that businesses are becoming increasingly footloose between Bristol and Bath.”
Across Bath, Bristol, Exeter, Swindon and Taunton, commercial property investment totalled £729M in 2018, a little above the £688M recorded in 2017.
In Bath itself, investor demand remains strong for office stock, but transaction volumes are being restricted by the lack of buying opportunities, and there have been few sizeable transactions. In addition, industrial stock levels are now critical according to the report, with few if any opportunities for new development.
Alison William, Associate Partner, Carter Jonas, said, “Many companies working within the Bath market are now forced to seek opportunities outside of the city; the facilities are simply not available. For example, we saw Roper Rhodes acquire 200,000 sq ft at Portishead in Bristol, Hawker Joinery relocate its workshops to Frome, and AJ Removals fulfil its storage requirement at Hallatrow. However, it’s worth noting that, such is the supply and demand imbalance, should the opportunity for speculative construction arise, rents for small business units could easily top £12.50 per sq ft, well above the regional average for this type of space.”
Pictured: Philip Marshall, Partner at Carter Jonas.