While many areas are enjoying a resurgence in commercial property activity, it seems that South Wales is benefiting more than most. Thanks to a huge media presence in Cardiff and the growing prowess of the region’s manufacturing industry, 2014 was very successful and industry experts predict that the future will only get brighter as 2015 progresses.
According to the latest analysis from DTZ’s Cardiff office, the Welsh capital’s office market enjoyed an “exceptional” rise of 82 per cent in take up in 2014 when compared to 2013. In total, 542,000 sq ft was let within the city limits, with 49 per cent of this occurring within the city centre itself.
In turn, this has paved the way for a number of new developments to spring up in the centre, one of which will take place over the next ten years in a project masterminded jointly by Rightacres and Cardiff City Council.
The Central Square project will create more than 1 million sq ft of residential, office and leisure space to the north of Cardiff Central Railway Station, ushering in a new era of prosperity for the city.
As part of this project, the BBC intends to invest in a new 160,000 sq ft headquarters for the broadcasting giant’s Welsh division which will lie on the site of the current bus station. Although the scheme still requires planning consent and the final sign off from executives at BBC London, senior director and head of office at DTZ Cardiff, Rhys James, is hopeful that groundwork for the new premises could begin as early as this summer.
He says; “The BBC HQ building has undoubtedly been the catalyst which has enabled Central Square to come alive and to become a deliverable regeneration scheme.
“It will be part of a scheme which, when joined with Network Rail’s planned redevelopment of Cardiff Central Station, will project Cardiff in to the premier league of European capital cities.”
The plans were revealed at DTZ’s 2015 Outlook seminar for the property market, where attendees also learned a little more about St Modwen’s upcoming development at its Celtic Business Park at Llanwern. The new 50,000 sq ft industrial build will be the first speculative development of its kind in South Wales for 10 years, something Mr James called an “encouraging sign” given the levels of investment involved.
Overall, the message from DTZ is that South Wales’ prospects are extremely positive, especially given the level of interest shown by both domestic and international investors during 2014.
Associate director of DTZ’s investment agency, Andrew Gibson, says; “The £655m invested in Wales throughout 2014 outperforms even the pre-recessionary years of 2005 to 2008.
“As 2015 progresses, the secondary market looks set to gather momentum which will produce a reducing gap between prime and secondary yields, ultimately benefiting the investment market in Wales.
“With the weight of money continuing to build and the regional markets remaining attractive to investors, it is likely that, post the historically low pre-election slow down, further high volume transactions will be seen in second half of this year.”
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