![]() Her tenants are looking at eaves heights, power supplies and the volume and location of docking bays, not primarily at swanky offices. So it is worth paying because it gets the building let so much quicker,’ Leigh says. ‘For us, the extra cost is not significant because adding the office floorspace means the building lets more quickly, and appeals to a wide range of tenants. This makes it the best value regional office space on offer. They do not charge separately for the offices, which are rented at the same £8.50 per sq ft as the warehouse. Yet developers like Aver reckon the extra expense of creating the office floorspace is well worth it. This compares with the (seriously) sub-£20 per sq ft typical budget for creating the warehoused floorspace. Yet the surprise to many in the office interiors world will be that it is not a cost carried by the occupier.Īver estimates that their budget to create their Grade A floorspace is a cost-effective £65 per sq ft. Of course, this level of quality office provision doesn’t come without a cost. It has to look professional, look well-presented, be somewhere clients and customers can come that doesn’t look like they’re being shunted into a mucky warehouse,’ she says. It needs to look like a corporate environment, which means the entrance has to look good as well as the floorspace. ‘We know this office space is important to tenants. Today, says Leigh, they can insist on space for back office functions, regional management or even the company HQ. Until recently, warehouse occupiers used office space in a fairly basic way to service their warehousing operation: stock control and the staff canteen were the principal purposes of what was always a scant allocation of office space. In Bicester we’ve created Grade A open plan floorspace, raised floors, ducting for data wiring, comfort cooling – its really high standard office space of the kind you wouldn’t expect in a shed,’ she says. ![]() ‘We’re responding to tenant demand, which is for better quality. Each of the high-specification units of this first phase, which range in size from 23,500 sq ft to 65,000 sq ft, has ample production and distribution facilities, plus Grade A office space at the rate of about 8% (the lower end of today’s expectations).Īver Asset Manager, Leigh Burnett, says the office floorspace is an important part of the appeal of new warehousing. Take a trip to the heart of the UK logistics sector in the Golden Triangle, a zone of motorway junctions and enormous distribution centres stretching from Tamworth south to Milton Keynes, and embracing much of the M40 corridor.Ĭlose to Junction 9 at Bicester Aver Property Partnership, a joint venture, backed by NFU Mutual, has invested in excess of £24 million on a 200,000 sq ft development of five units. So how much office space is being included in these new schemes? The answer is that it varies, but warehouse developers typically offer between 5% and 12% of their total floorspace for offices – a figure that is now settling at the higher end of the spectrum. That is because warehouse developers are building more offices (as a proportion of their total floorspace), and building them to a higher quality than ever before. New data shows that sheds could easily be the biggest source of new regional office floorspace supply in the coming 18-36 months, with as much as nine million sq ft of new warehouse-related offices coming on stream by 2023. Whilst the office market shudders and retail property collapses, the ‘shed’ sector has been riding a tidal wave of new demand, generated by lockdown e-commerce.īut what has largely escaped notice is the growing proportion of new warehouse floorspace that isn’t warehousing at all – it is offices. But those offices are in warehouses, not office blocks. The surge in e-commerce is creating up to nine million sq ft of new offices in the UK regions.
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