Bradley Hall reveals top trends to watch as the region’s commercial property market settles into a brand new year.
As we head towards the spring of 2024, the region’s commercial property market is heading for brighter days and preparing for what many experts believe will be, in some areas, a positive turning point after a few challenging and unpredictable years.
Key factors attributing to experts’ optimism include a hopeful fall in the UK base rate and low levels of developments, putting downward pressure on vacancy rates and, in turn, delivering rental growth – but it doesn’t stop there.
The North East’s commercial property sector is poised for a significant transformation over the coming year, swayed by increased environmental responsibility, changes to work patterns, evolving business model trends and more.
Northern commercial property experts Bradley Hall has seen an increased uptake in a variety of commercial property spaces during the start of 2024. The firm has completed on dozens of deals, with retail space as the front runner, with office, industrial and development acquisitions and leases being agreed across the North East.
Bradley Hall’s commercial property team shares its insights into some of the emerging key trends influencing the region’s commercial property landscape.
Retail space
Retail space has seen a vast evolution in recent years, with many big-name causalities along the way leading to empty units and fears over what the future of Britain’s high streets would be. Alongside the closure of many traditional ‘shops’ has came the opening of experience-led shopping, including sites like STACK which mix together smaller, local retailers with a range of places to eat and drink. Even larger department stores are concentrating on creating a range of quality eateries, bars and cafés to attract visitors, the prime example being Fenwick Newcastle with its range of venues including Mother Mercy, Porterhouse, El Feugo, Café 21, and Saltwater Fish Company based across its multiple floors. ‘Buying local’ has also seen a resurgence, which has encouraged more small retailers to set up shop in locations away from the high street.
E-commerce business sites
Four quick years have passed since the Covid-19 pandemic began, but a number of the changes it introduced still remain today – including a rise in online businesses.
Coupled with UK’s not-so-recent exit from the EU, this has allowed for more businesses to hold on to larger amounts of stock and take better control of their supply chains – thus increasing the demand for space, such as large and small distribution warehouses and centres.
Tech hubs and innovation districts
Cities across the North East are establishing tech hubs and innovation districts to attract startups, entrepreneurs and established tech companies. These areas offer specialised commercial spaces, networking opportunities and access to talent pools.
Revitalisation of industrial zones
Former industrial zones in the North East are undergoing revitalisation, transforming into modern commercial spaces for manufacturing, logistics and creative industries. Adaptive reuse projects breathe new life into these areas while preserving their industrial heritage.
Sustainable building
Environmental issues – including climate change and biodiversity – will remain at the forefront of new developments and existing commercial spaces. New biodiversity net gain regulations – enforced in the UK from January of this year - and increased importance around climate risks to buildings and infrastructure will no doubt be at the forefront for many occupiers, investors and lenders.
Integrated spaces
Mixed-use developments – ones that combine commercial spaces with residential, retail and recreational areas – are set to gain popularity in many parts of the North East. Not only do integrated spaces like these maximise land usage, they also create communities in which work, leisure and living can combine, helping to increase the work-life balance many people are looking to achieve now. Many businesses will be looking towards adaptive reuse – repurposing existing commercial properties into vibrant, mixed-use hubs – over the coming year.
Transit-oriented development
With an emphasis on sustainability and urban mobility, there's a growing focus on transit-oriented development in the region. Commercial properties near public transportation hubs are set to experience increased demand due to convenience and accessibility.
