Berkshire & North Hampshire: Historic highs and lows in office markets
The Bracknell Forest and Maidenhead submarkets have historically had vacancies of above 15%. However, over the past few years, they have come steadily downwards to near-record lows. Conversely, vacancies in Basingstoke & Deane and Hart have risen to all-time highs, at around 15% and 24%, respectively.
Underpinning these swings among submarkets are several large occupier moves over the last few years. Driving net absorption in Bracknell Forest and Maidenhead include lettings to Daler-Rowley (77,600 sq ft), FM Global (55,700 sq ft), Honda Motor Europe (69,400 sq ft) and Panasonic (44,200 sq ft).
Meanwhile, recent departures from the Basingstoke & Deane and Hart submarkets include Barclays (137,000 sq ft), Thales (63,300 sq ft) and Virgin Media (49,200 sq ft), with these firms decamping to newer offices in Reading’s Green Park, Forbury Place, and Central London.
One of the reasons cited by firms leaving these submarkets has been the inability to find suitable space to expand. Indeed, over the past five years, under 90,000 sq ft has delivered across the two underperforming submarkets, with just one building over 20,000 sq ft constructed—the Florence Building on Basing View in Basingstoke (60,500 sq ft).
This has been further compounded as around 500,000 sq ft of office space has been converted to alternative uses or demolitions over this time. And while this has kept vacancies in check in the absence of move-ins, it has also limited the opportunity for large occupiers to take space in the submarkets.
Looking ahead, with office rents expanding by around nearly 30% across all of Berkshire & North Hampshire’s submarkets over the last five years and continuing to grow strongly (unlike in many other submarkets across the country), this could help attract some development and consequently occupiers.
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Source: CoStar
