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Will Mooney, Partner at leading consultant Carter Jonas, gives his take on issues in the commercial property world.


A new year message for all seasons

This past year has been a pivotal year for property and development interests in Cambridge.

If 2013 could be characterised by the phrase ‘that was the pre-let year that was’ – and, boy, was it – 2014 has been the year in which commercial property interests were pre-occupied with what and who is coming next, more than the more obvious of what is being built now.

Considerations of the ‘where’ and the ‘when’ are what will be worrying agents in Cambridge and its sub-region as we face 2015.  

In the middle of 2012, agents were flagging-up a list of concerns about supply/demand tensions, the paucity of Grade A accommodation, the development pipeline and its draw- down rate which painted a very interesting picture of what mid-2015 might look like. 

Concern about that scenario remains. If anything, an increased flurry, since 2012, of blue-chip corporates’ interest in having a Cambridge base has tightened the screw.  

Odd to think that the prospect of big fees should furrow agents’ brows – but it does because it means our job is more difficult.

We can be a perverse bunch, us property people. Our approach to mindfulness concentrates on the future as much as the here and now – if not more - when it comes to land supply and the planning timeline when the necessary process of application, consultation and approval can lag somewhat far behind commercial pressures to deliver.

So many cranes in the city centre, the new Cambridge Biomedical Campus and the extension of the established Science Park can be cold comfort for property future-gazers. 

While a testament to development and planning success in years past, we can only hope they are also indicative of future successes too upon securing identified land.

As the year ends, property ‘twitchers’ aren’t looking at the cranes but towards the policy and practical debates surrounding the progression of the Local Plans of Cambridge City Council and South Cambridgeshire District Council. 

These parallel plans, in which sites and numbers for development to last on a rolling, 20-year programme in these two hothouse areas of the country, are scheduled for adoption in autumn next year.

The official adoption of these plans is keenly anticipated by the city’s commercial property agents as, by the middle of 2015, opportunities to actively pre-let from the planned and being built new stock will be more, or less, exhausted.  

For those Cambridge occupiers in-situ who still hold on to the belief that when they need to move to new premises in the city, there will be property just waiting for them, 2015 and 2016 holds a surprise in store. 

Once again, we repeat our call for property to be higher up the operational business agenda in the way it is for investors who continue to look at the stellar performance of Cambridge when it comes to returns on the best property investments. 

It’s not necessarily a new year message. It’s a message for all seasons and one which agents never tire of repeating.

Big names making the noise

Famous for its start-ups, SMEs and University spin-outs, it’s the big names of the international business world who’ve been making the most noise on the Cambridge scene in the past few weeks.

Melting the iceberg

As we head towards the end of the calendar year, commercial property agents are having to work as hard as ever to secure the property deals which support a healthy churn of day-to-day business.

Dense & Sensitivity

The ignominy of being ‘awarded’ The  Carbuncle Cup for the worst building in Britain this year belongs to a mixed-use, 17-storey scheme of 109 apartments spread across interconnecting blocks, overlaid across a 7,800 sq m superstore located in The Royal Borough of Greenwich. 

It’s not pretty but in its defence, the winning scheme is sited in Woolwich – a very densely occupied part of a borough which also boasts its own royal park in Greenwich Park and the relative open expanse of Blackheath – the latter in shared ownership with the neighbouring borough of Lewisham.

To ask architects to provide a design for a building which looks good, works well and to a tight budget and commercial viable timescale is no easy challenge but it’s one the profession is being asked to do more and more.  And not only in megaopolis cities.  Many of the new buildings in Cambridge have come in for carbuncle critique in the past and present and, no doubt, will in the future too.

I’ve yet to meet an architect who doesn’t feel passionate about and doesn’t want to deliver really good design. With scarcity of allocated supply of land meaning anything up to 50 percent of the cost of a new commercial building in areas squeezed for land availability, commercial cost is king when it comes to the given brief.

The latest edition of the gazette published by the Cambridge Association of Architects  - which is the local chapter of the RIBA -  is called ‘Aspirational Working’ and density is one of the key elements acknowledged in the wider theme of considering how and where we are going to work.

In contributing to an article entitled “Park Life” which looked at how the ubiquitous Business Park could evolve to meet the modern demands and constraints of working life and viability, commercial property agents in the city were asked for their input.  In preparing the article, its author focused on transport as one way to increase building density. In essence, basement parking or podium buildings or shared company parking to allow combined people and car friendly spaces between closer buildings. 

Setting aside the cost of engineering solutions to underground building in the Cambridge fenland, it was realistic to see the importance of the car acknowledged in the equation. Too often, the fact that most people who work in Cambridge don’t actually live within walking or cycling distance of their workplace or have access to public transport when they need it to get to work in a timely fashion is overlooked.

To accommodate vehicles is a way which can be achieved by a design and engineering solution to maximise land use, as well as being aesthetically pleasing, has got to be a bonus in attracting a commercial developer to the viability of a potential site, not to mention occupiers.

Coming back to the Carbuncle Cup, the fact that the Woolwich scheme is mixed use with residential and commercial tenures couldn’t have helped.  

That’s not to say the best don’t work and,locally, it will be interesting to see how the Cambridge Fire Station development on Parker’s Piece matures but this was a hi-spec commercial mixed with high-end residential use.  

You see, historically, we’re not very good at sharing our homes with other people’s place of work.  Lack of any other option in the future, due to land availability, might mean we’ll have to get real and change.

Fruits of the city

The summer has seen property interests focus on the south and north poles of the compass points of Cambridge.

City-state of the nation

Early in July, the Government announced the release of the first tranche of a big pot of £6 billion of cash for the English regions. With an eye on being better together and although the phase 1 £12 billion is very much for England, the Prime Minister heralded Growth Deals as ‘...a crucial part of our long-term plant to secure Britain’s future.’ 

Spatial awareness

In seeking to do our best to pour a quart into a pint pot when it comes to business space requirements in Cambridge in current market conditions, property agents are also tasked with finding the right kind of space in which modern businesses and their employees want to work.

The spectre at the feast

A year ago I was anticipating the end of the central banks’ monetary stimulus for their economies. In the case of the Bank of England, it was, at that point, the £375 million worth of quantitative easing.

The bills and skills to make the builds

Setting aside the uncertainty of interest rate rises, what could severely hamper the speculative development all peer Cambridge agents are calling for in the long term - and have been eagerly anticipating for Q4 2014 and Qs 1 & 2 in 2015 - is a steep increase in build costs.

Down on the pharm-a

The sound of the “plink, plink Pfiz” echoes around the Cambridge commercial property market presently as the wider political debate hots up on the national and international stages with the prospect of a hostile takeover bid of AstraZeneca by US pharmaceutical company Pfizer.

Cambridge springs eternal

It was neither a surprise nor an April fool to read on 01 April that once the devil of the detail of the Chancellor’s Budget statement in March had been examined, it turned out the local headline-grabbing £1 billion ‘City Deal’ for Cambridge was more damp squib than big deal in the eyes of business in the city.

Magic numbers

Property agents regularly publish research and statistics in seeking to present a view – their view – of their market.

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