Graham + Sibbald are extremely active in the Highlands & Islands, disposing and acquiring all styles and type of commercial property.
For the purposes of this article, the subject is industrial property and particularly why it is such a strong asset class.
The Longman Industrial Estate is the premier business address for Class 4, 5 & 6 (and some retail) operators within Inverness and it serves the local population of upwards 60,000 people. It is also the focal point for business for the wider Highlands & Islands which has an estimated population of in excess of 250,000.
Within the Inverness area, there is a limited supply of development land and therefore the Longman (out with the established areas of the Carse Industrial area and Dalcross/Inverness Airport Business Park) experiences very little competition from other locations. As such, local occupiers and existing businesses will seek to secure accommodation within the Longman Industrial Estate to serve the established customer base. There is very limited supply of new build industrial accommodation within Inverness and the Longman in particular due to the lack of available land. Because of the occupier demand, older units tend to be refurbished, upgraded and extended to meet the requirements of occupiers and businesses as they grow. There is not enough development to cater for the demand from occupiers and that underpins the Longman as the premier business address within Inverness. The Longman cannot naturally extend because it is bordered by the Moray Firth, A9 trunk road and Inverness city centre. The combination of active occupier requirements and lack of new product means that there is significant pressure on rental and land values remain strong, despite the recent economic uncertainty and interest rate rises.
We have seen significant rental growth over the past 18-24 months and void periods for units are often practically nil. Because of this demand, the quality of units when compared to new build is often secondary.
Headline rental levels for prime properties are now well in excess of £10 per sqft, void periods are practically nil and it is possible to secure long term leases. Land values are also protected by this depth of demand where established businesses prefer to purchase rather than lease.
Given the difficulties in acquiring industrial property in the Highlands, Graham + Sibbald can offer to act on your behalf. At the outset, once your requirements are understood, we would provide a report highlighting suitable options in the market. Given our expert knowledge, we can provide ideas and opportunities that are not actively marketed. In the majority of cases, the property which is ‘off market’ is the right one.
Using Graham + Sibbald for the acquisition of your property can help avoid any surprises and minimise the risks of buying / leasing in a complex and very active market.
