Our latest guest blog is with Nick Atkinson. Director of HTA Real Estate Ltd. Nick has been involved with many of the region’s largest industrial developments such as Radial 64 in Washington, Teeslink at Wynyard Park and the region’s largest speculative development, Drum Park in Chester le Street. He has experience in dealing with Brownfield divestment projects including consultancy advice to Rio Tinto on the disposal of their 250 acre former aluminium smelting complex in Northumberland.
He speaks to Invest North East England about the current property market in the North East and why it is a great place to invest
What is your view of the current state of the North East’s industrial property market?
The automotive sector remains strong and steadfast principally hinged around Nissan but not exclusively so.
Suppliers in the North East are supplying other car manufacturers but Nissan of course has the biggest bearing, which is particularly pertinent since Nissan announced its two latest models, the new Qashqai and the X-Trail, which has never been manufactured here.
There are lots of new contracts on the back of those models and subsequently quite a lot of activity in the property market around that.
This drives the Washington area as an in-demand location for Tier 1 suppliers as suppliers prefer to be as close to Nissan as possible.
The Tier 2 supply chain extends more widely across South Tyneside, County Durham and the region.
In the renewable energy sector, it’s encouraging to see Smulders secure a contract for wind turbine jackets to be manufactured at its Wallsend site which is good news.
The North East property market is also sharing in the rapid growth of the parcel delivery sector over the past 24 months, with all the big players in the market improving their delivery capability as the e-tailing sector continues to grow.
What are the key development opportunities and trends in the North East?
The on-going success of the North East ports at Blyth, Tyne, Sunderland and Teesport stand out and the way they help drive the regional economy through imports and exports. Newcastle airport is also well placed to contribute to this growth.
The North East LEP has been instrumental in encouraging development by providing grants to stimulate the delivery of speculative new industrial buildings. This has proved to be valuable in delivering new stock to the region and buildings have been taken up
We’ve also seen far-sighted local authorities like Newcastle City Council taking over-riding leases for office sector development at the Stephenson Quarter and Science Central which provides the support developers need to develop speculatively.
This speculative development is fuelling a much needed gap in the market and it is hoped will help stimulate further private sector development.
Why is the North East an attractive place to locate or expand?
It is definitely the skilled labour supply, lower labour costs and cheaper cost of land.
For instance, North East England is an ideal location if you are in the automotive manufacturing sector for Nissan and other manufacturers such as Jaguar-Land Rover.
Skilled and available labour supply is more abundant here than in the Midlands, which has become a competitive and saturated labour market.
Companies there are all competing against each other for a limited workforce and so the North East would appear to be a far better option.
A less tangible, but no less important USP, is workforce loyalty. The nature of industry in the North East through its coal mining and steel making past means people here traditionally have a loyalty to their employer.
That’s a real plus point for the North East as it is very expensive for business to recruit and train people, therefore staff retention is valued.
What is the importance and benefit of having the North East Property Database?
This is something that has been tried previously on a number of occasions but this time the format is right with a timely supply line of accurate information.
That’s the importance and value of the property database – its accuracy.
It is ideal for a business new to the region who very quickly want to get a handle on what is available in the property market.
It isn’t trying to be all things to all men, but provides an accurate and concise reflection of the relevant commercial opportunities.
Businesses have contacted us for more information having found property on this database and that’s how it helps both our business and the region.