GVA considers Bristol’s bright prospects
There’s every reason to think that Bristol offers the best prospects for growth of all UK regional cities, and excellent opportunities for investors seeking alternatives to London’s superheated property markets, says GVA in new research.
GVA notes that Bristol has remained resilient thanks to the scale and diversity of its economy and its highly skilled workforce. It has four universities, attracting a wide range of employers from knowledge-based, IT and high-tech sectors, with the Bristol and Bath Science Park already a focal point. GVA forecasts that output in Bristol will grow by 12% to 2017, above the 10% forecast rate for the UK as a whole over the same period.
Average rental values for property to let in Bristol have remained in decline since the 2007/08 financial crisis; GVA forecasts 0.6% rental growth this year on average for office space to let in Bristol while for Bristol retail premises to let it forecasts an average decline of 2.3% and for industrial property to let in Bristol GVA expects an average fall in rental values of 0.5%. The firm forecasts that rental value growth for Bristol offices will reach 3.5% per year by 2017; it forecasts that rental values for Bristol industrial property will turn positive in 2014 and for Bristol retail property in 2015.
Occupier demand for office space in Bristol has remained relatively resilient, GVA says, and is expected to remain healthy over the longer term. The market is currently forecast to reach a tipping point in 2014 when average annual demand is expected to exceed supply. Within the industrial sector, Bristol’s take-up is roughly 75% warehousing and 25% industrial; prime rental levels have held up at £6-£7 per sq ft for better stock, and incentives are now dwindling as availability declines. Buildings constructed since 2000 are virtually non-existent, the firm points out. Bristol has not been immune to the problems besetting the UK retail sector, but has fared better than most regional centres, GVA says: it feels that Bristol will also be well placed to adapt in view of the rapid expansion of online retailing and the accompanying demand for distribution hubs.
“The city’s new mayor and high-performing LEP provide an unprecedented focus and catalyst for growth, meaning opportunities abound for cash-rich, savvy investors to capitalise on Bristol’s stored-up potential,” GVA concludes.
