A shortage of commercial properties in and around Malvern is pushing up office and industrial rents, as the area becomes increasingly popular for business re-locations, particularly with tech companies, according to Worcestershire’s largest independent commercial property agency GJS Dillon.
Malvern Hills has the second lowest vacancy rates for both office space, of 2%, and for industrial accommodation, of 1.9%, in the county, despite take-up of space in 2018 being below the five year average.
“The Malvern Hills traditionally has the lowest take-up levels owing to its smaller commercial market, which can part be explained by its physical constraints with the Malvern Hills forming a natural boundary and the River Severn being in between the area and the M5 motorway,” says Andrew Lewis, Head of Agency at GJS Dillon, writing in GJS Dillon’s Worcestershire Commercial Property Market Report 2018/2019.
“However, these historic connectivity issues are set to be improved with the Worcester Southern Link Road enhancement, which should assist the business community in Malvern.”
Low vacancy rates and improving communications have seen average industrial rental levels rise above £5.50 per sq ft for the first time in five years, while average office market rents are sitting just below £13.00 per sq ft, outperforming neighbouring Worcester and almost in line with the highly connected submarkets of Wychavon and Bromsgrove.
Mr Lewis continues: “The Malvern Hills has capitalised on its past to create a tech hub unique to the Midlands. This inward investment has been noted by developers and the office development pipeline is reasonable. As more high quality space comes to market, we expect office rental and capital values to increase alongside the number of transactions.
“However, despite rising industrial rents, the same quality of manufacturing space is not yet available. Sites need to be identified where research and development and manufacturing hubs can be developed and used to attract the inward investment of tech occupiers – mirroring what has been done at the Malvern Hills Science Park and Malvern Technology Centre, but for the industrial sector.”
GJS Dillon produces an annual review of Worcestershire’s commercial property market, based on figures and analysis from CoStar, which it uses to advise vendors, purchasers, developers, landlords and tenants. Further details about the 2018/2019 market report can be found at https://www.gjsdillon.co.uk/marketreport or from Andrew Lewis on tel. 01905 676169 or email. email@example.com.