Tim Davies, Head of office at Colliers International’s Bristol office, believes positive indicators across all sectors will convince business leaders the time has come to invest and expand in the city.
He said the industrial, offices and hotels sections were showing increased activity levels. The Government’s decision to proceed with the Hinkley Point C reactor would have an enormous impact on the region’s construction sector.
“The deal announced with EDF will result in a surge in demand for both permanent and temporary living accommodation once the multi-billion pound construction programme gets underway. The announcement will trigger a raft of new development not just in the immediate area but spreading across the South West – especially along the main motorway axes.
Tim said: “There is no doubt we are looking far stronger than we were four years ago and the signs are the commercial real estate market in the South West will be in the forefront of the recovery.”
The Broad Quay-based logistics chief said latest reports indicated small to medium companies were re-occupying commercial space they had disposed of during the downturn.
He said the South West was third behind London and the South East in terms of growing business activity.
“London is getting so expensive that many institutions are looking a lot more at regional opportunities. We have also seen the first speculative developments across the west, with at least two further big shed deals in the pipeline.
“Increased demand combined with a shortage of quality accommodation could cause a bottleneck with the tipping point occurring some time during 2014. Prime rents will start to pick up as a result of the correction in supply and demand.”
Tim Davies said the Bristol office market was also looking rosy with city centre take up 42 per cent up on last year.
The bias toward bigger deals in the 25,000 sq ft and upwards bracket rather than a large number of smaller deals in the 1-10,000 sq ft bracket also indicated the sector had emerged strongly from the downturn.
Turning to retail Tim said the gap between top and bottom performing centres continued to widen and demand in the regions remained
But he said Bristol and the West Country offered a number of hotspots Cribbs Causeway, Cabot Circus, the Cotswolds towns, Exeter and Bath.
Tim concluded: “The faster than anticipated recovery in the UK economy has stoked confidence in the commercial property market in the South West.
“We have the infrastructure in place - whether terminal, roads, rail or warehousehousing, to ensure the region benefits from the increased business coming our way. We are already seeing a resurgence of the market rental and freehold figures that have been depressed for several years. This means that there are excellent investment opportunities in the market, especially with the national concerns that are seeking accommodation in the South West. With the likelihood of rental increases and a general undersupply of vacant stock there are opportunities for existing buildings to be refurbished, which could help address the imbalance between supply and demand.”