Take-up in Oxfordshire’s office market was 20 per cent up last year, according to the VSL Intel annual report.
The VSL report focuses on central Oxford and the A34 ‘Innovation Knowledge Corridor’, for offices from 3,000 sq ft and industrial space from 5,000 sq ft.
Office take-up was recorded at 324,700 sq ft, which is on par with the five-year average. But VSL says rents had accelerated during the year due to limited supply of quality stock and competition.
Industrial demand showed a total of 1.26 million sq ft of take up, fuelled by retail distribution and warehouse sectors as well as the continued growth in science and technology.
Bicester was the main focus of take-up, accounting for half of all transactions. The average transaction size increased during the year by 18 per cent to 25,800 sq ft.
VSL director Richard Venables said: “Despite the siren calls for the death of the office, we haven’t seen a dump of office stock, although a number of businesses are looking at consolidation.
“It is only once we adjust to the new normal that businesses can really assess their needs and the social interaction the office environment provides will never disappear. As one client commented recently, the office hasn’t died, it’s just evolved.
“Oxford has been synonymous with hope in 2020. The global spotlight on Oxford and the cutting-edge research carried out here has already had an impact on the commercial property market.
“Many landlords and developers are now looking at vacant property and thinking how these can be adapted or re-purposed for science and technology use.
“Investment is pouring into the region both in terms of funding for research and property investment and development. This bodes well for exciting times ahead and Oxfordshire needs to rise to the challenge of meeting these opportunities.”
Co-director Tom Barton said: “New build office activity is still limited and will continue to be so for some years to come. Refurbishment and re-use of space will bring more stock to the market and this will, inevitably, also include former retail space.
“The industrial market has been more active with the development of a record amount of new space over the last three years. This pace of development will undoubtedly reduce in coming years, mainly as a result of the pipeline of development sites drying up.”
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