Page 3 - 2018 Kent Property Marke Report

WELCOME
Welcome to the 27th Edition of the Kent Property Market Report, produced by Kent County Council’s Economic Development Division, Caxtons and Locate in Kent.
This year’s report reviews property deals and activity throughout 2017-18. It also covers major initiatives and projects to support growth and economic development.
The UK economy has proved relatively resilient over the last 12 months despite the backdrop of uncertainty around Brexit and the prospect of trade wars. Overall economic output is expected to show growth around 1.4% for 2018 as a whole. However, there are wide variations in the performance of individual sectors of the economy. UK property reflects the disparities in the wider economy. The UK All Property Total Return for 2017 was 9.6%, more than double the previous year (MSCI). Despite the positive performance recorded in the office and, in particular, the industrial sector, the All Property year end outcome was diluted by a weak retail sector.
Across the UK and south east in particular, the business park market has seen strong letting activity. Demand from traditional business/professional services remains robust, with a marked increase in demand from technology, pharmaceutical and medical sectors. Despite buoyant activity, rents across the south east have generally softened due to smaller scale needs and as a function of the development pipeline now delivering new space to the market. Kent generally follows these south east trends.
The town centre office market continued to perform well. Nationally, there was increasing take-up from companies seeking to locate in quality town centre locations with the benefit of high skilled labour and transport infrastructure. Growing levels of freelancing and start-ups are adding to demand. The Kent market reflects this. Overall average prime rents across the county grew by 4% over the year to the end of H1 2018. This follows strong growth over the previous two years; rents now stand 16% ahead of the pre-financial crisis peak. (Caxtons)
Nationally, the industrial market has been the strongest performing sector over the last two years. Shortage of stock combined with rental growth has combined to deliver both
capital and income returns. Similarly in Kent, prime rents are rising by an average of 4.4% to the end of H1, twice
the long run mean. The county has seen a number of significant lettings as well as buoyant activity at the smaller end of the market.
The retail sector has faced challenges with further high street name failures. Kent has seen prime high street rents dipping 2.7% and losing some of the gains made in 2016/7. However, Kent also illustrates many success stories as town centres are re-invented in this period of change with Phase 1 of Legal & General’s £53m St James new leisure and retail development opening in Dover and Spirit of Sittingbourne regeneration reached its first milestone this year.
Nationally the housing market has seen another year of low turnover. Economic and political uncertainty and increased costs at the upper end of the market, has taken its toll on home moves. The new homes market remains buoyant however, supported by the Help to Buy scheme. Kent saw the completion of 7,800 new homes, a 7.3% net increase in the number of new dwellings in the 2016/7 financial year, just 4.6% shy of the pre-financial crisis peak. With a sharp upturn in the number of units with planning consent or in the planning pipeline, numbers are expected to rise further in the coming years.
This year’s report features Kent’s ‘garden settlements’ with a focus on Ebbsfleet Garden City, Otterpool Park Garden Town near Hythe and Chilmington Garden Village near Ashford.
The Economic Development section features current
and planned developments across Kent and Medway.
It focusses particularly on Kent’s growth areas, the continuing regeneration of Kent’s coastal towns and Kent’s second Enterprise Zone (North Kent Enterprise Zone) as well as the existing and successful Enterprise Zone at Discovery Park. The report also looks in detail at Kent’s rural property, tourism and the provision of green infrastructure. The Transport section highlights the significant Government investment in transport schemes across Kent. This includes updates on road and rail infrastructure.
The Strategic Developments pages feature a comprehensive list of commercial sites and developments as well as planning information, useful contact details and location map.
The full report can be found at www.kentpropertymarket.com If you would like further information on the developments or
projects featured contact details are shown on page 59.
Caxtons Chartered Surveyors, established in 1990, is one of the largest independent property practices in the South East offering a full range of agency, management, professional and surveying services across all property sectors.
Kent County Council’s Economic Development Division
is responsible for working with public, private and voluntary sectors to support Kent’s economic growth by encouraging and supporting businesses; working closely with specific sectors to promote growth and finding new ways of funding business critical infrastructure and unlocking key development sites.
Locate in Kent provides a comprehensive, confidential and free business relocation and advisory service for all companies looking to relocate to or expand in Kent and Medway.
The producers of the report would also like to thank the following for their sponsorship and contributions to this year’s report: Clague Architects, Cripps, DHA Planning, Handelsbanken, Kreston Reeves and the Royal Institution of Chartered Surveyors.
We hope you find the report useful and informative.
Mark Dance
Cabinet Member for Economic Development, Kent County Council
Ron Roser
Chairman, Caxtons
Gavin Cleary
Chief Executive, Locate in Kent Ltd
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