It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.
It has become something of a tradition, given that we’ve been doing this now for over 30 years.
Here we speak to Edward Marshall, director of Frank Marshall Estates, based in Bradford.
2020 has been a difficult year for many sectors in Yorkshire but industrial property has, on the whole been, in a great position and has bucked the trend. Rents have increased and occupancy is at an all-time high. We see 2021 as being a challenge for occupiers, who will find it increasingly difficult to find the space they need in the smaller size ranges below 10,000 sq ft and even more acutely in the sub-5,000 sq ft range. This is because there are fewer developers operating in this sector and sites are difficult to obtain at a price that makes small unit developments viable.
On this basis we see business going well for us as one of the major small unit operators in the Yorkshire region next year. In this context, we have formed the successful Nano Park Company which specifically targets this sector, building prime workshop and office space in small units across the region. This exciting model, which is full of potential, provides an ideal base for small and fledgling companies and satellite operations for larger firms. We will be rolling out this concept across the county in 2021.
Meanwhile the significant move away from shops to on-line, the reduction in the need for office space and the increase of smaller owner-occupier businesses, post-Covid, also points to a strong 2021 for Frank Marshall Estates and the industrial property sector generally.
However, we see the large unit sector above 100,000 sq ft becoming saturated as everyone jumps on the bandwagon. The ever-increasing low yields being paid for industrial investments will mean many inexperienced investors are going to find it very tough over the next few years. Sheds are sheds, but they don’t keep going up in value like a house. If you are buying industrial at a 5% yield, buy residential. Happy New Year.