THE DERBY MARKET PROPERTY REVIEW – THE WINNER TAKES ALL!

Market Overview News

Some would describe 2012 as the golden year with the Olympic and Paralympic games being held in London and the Queens Jubilee Celebrations. As with any sporting event there are the winners and losers and this analogy can be related to the property markets. Within the retail sector of the market, some parts of Derby City Centre have performed much better than others. The Derby retail study which was carried out by FHP in the Autumn of 2012 identified 790 shops in Derby City of which 90 were vacant with 16 occupied but available. This equated to an overall availability rate for Derby City Centre of 13.42% which was a small improvement on the 2011 study when the availability rate was 14.66%.

However in terms the overall retail market nationally the effect of online shopping has contributed to and continues to impact upon the High Street. Many national retailers have reduced branch numbers and concentrated into the top 150 – 200 locations at the expense of the smaller town and suburban centres.

Secondary retail locations are suffering more than the prime shopping pitches although there are pockets of success such as Sadler Gate where the vacancy rate is the lowest it has been for some time.  FHP have secured a number of new lettings in this niche retail location during the last 12 months and out of the 50 shops on this street there are just 5 vacancies of which 3 of these are incorporated within the Old Bell which has recently been sold and is due for renovation. This is most encouraging compared to 2010 -2011 when there was in excess of 10 retail vacancies.

In our view the Derby retail market is ‘holding its own’ in comparison to other cities across the UK. In 2012 we saw a steady amount of enquiries from national, regional and independent operators and this is evident as the vacancy rate was reduced by comparison with the year before which is encouraging. Derby is now a shopping destination in its own right as seen by new retailers into the Derby market such as Co-op Travel (Mid-counties), Ask Italian and Luvya Babes. Whilst the retail market is currently experiencing fluctuations as a whole Derby is by no means on its own and as seen by the lower availability rate is ploughing on regardless through these difficult times. The new retail study is due to come out in early spring and it will be interesting to see how the city performs year on year. 

As an agent you have to react with the market to make sure the dealings are dealt with efficiently to meet deadlines within the market place in order to be successful and beat off competition. Two weeks before the Christmas period a property investment was sold on Sadler Gate of which from the point of instructing solicitors the transaction had to be completed within two weeks and I am delighted to say we were successful.

In another scenario Stancliffe Stone had an office property requirement for 3-4,000 sq. ft. We knew there was lots of competing stock in the market place any by having a good working relationship with Clowes Developments (UK) Limited this allowed us to quote terms and agree on a deal before competing agents could even raise a proposal. This led to the letting of Units 1 and 2 Key Point in Alfreton totalling 3,875ft². This deal relied heavily upon having a good relationship with the landlord whereby they could provide us with immediate answers to structure the deal and react to the market.

Looking forward to the rest of this year, whilst we have seen some high profile casualties recently such as Comet, HMV and Jessops, I do believe that the Derby retail market will remain resilient in the face of adversity. The office and industrial sectors are likely to remain challenging, however with appropriate marketing and pricing deals can be done.