North West review of H1 2010
North West property experts Place North West have interviewed a number of property professionals in the region to look back over the first half of 2010 and give their views on prospects for the rest of the year.
The scale of public-sector cuts to come means that public bodies are going to have to consider how best to use their property assets. Phillip Woolley, partner at Grant Thornton, says the public sector will need to think about asset sales, joint ventures to cut costs and deals such as sale-and-leaseback or moving services and departments to share buildings. John Holmes, head of planning at Hill Dickinson, says we have to wait for the Localism Bill due nearer the end of 2010 to find out more about how the government plans to fill the gap created by getting rid of regional special strategy bodies.
John Jones, partner and head of corporate finance at Beever and Struthers, points out that the market for office space in the North West is quite different from that in London. There is an oversupply of offices in the Manchester area and little or no development activity is likely until demand returns, he warns. Many property companies are carrying huge debt burdens and the lack of demand means there are no easy solutions for their funders, he adds.
At Hill Dickinson, head of retail property Pam Jones says there have been fewer failures in the retail sector in the North West than expected, but it has not been an easy ride so far this year. In Bolton, Iain Mowat at the Vinden Partnership agrees that retail has been suffering from the credit crunch and warns that with spending set to be squeezed further, the situation is unlikely to improve soon. He adds that industrial has been one of the better-performing sectors so far this year as oversupply is diminishing and businesses are taking the opportunity to acquire high-quality industrial space that might not have been available a couple of years ago.
