Swindon’s commercial property market has enjoyed its best year since before the recession, according to a new report.
Take-up of industrial buildings more than doubled in 2015 while the office market was also strong, property agents Alder King’s latest Market Monitor shows.
That has further heightened the need for speculative development, particularly in the town centre where demand for office space in rapidly outpacing supply. 
Construction of the first speculative office building started at Westmead and further buildings and schemes are being actively marketed at South Marston and in the town centre, according to the report. But the lack of new space in the industrial market is forcing some potential occupiers to look outside Swindon.
The Market Monitor says the strength of the office market can be gauged from the fact that competitive bidding has taken place for new offices at Churchward – and area now widely recognised as one of the town’s prime locations.
Nationwide recorded the largest office letting with its acquisition of the 70,021 sq ft (6,505 sq m) Optimus Building at Windmill Hill Business Park. Other notable transactions were BP’s deal at Auckland House, Lydiard Fields, where it took 36,548 sq ft (3,389 sq m), and Oxford Brookes University’s decision to relocate its Swindon Campus from Ferndale Road to the 28,412 sq ft (2,639 sq m) Delta 900 building on the Delta Office Park.
Alder King partner James Gregory, pictured, said the overall level of supply for office accommodation fell significantly as a result of improved take-up and the conversion of redundant buildings to residential use.
“Occupiers are increasingly finding it harder to fulfil their requirements,” he said. The lack of space is pushing up rents with Station Square in the town centre, which was speculatively refurbished in 2013 and is now fully let, achieved an improved headline rent of £17.75 per sq ft (£191 psm).
Out of town rents also improved with £18 psf (£198 psm) achieved at Auckland House and £17 psf (£183 psm) was achieved at Arclite House at Peatmoor where communications group Excalibur expanded into 11,000 sq ft (1,022 sq m).
The level of incentives also fell steadily throughout last year and early flexible break clauses are being pushed out as tenants are forced to commit to longer leases, said the Market Monitor. 
In the industrial market, take-up in 2015 was more than double the 2014 level due to the return of larger lettings.
Six deals were above 50,000 sq ft (4,645 sq m) – the former BCA building at Groundwell, 3C Pagoda at Westmead, 67K at Elgin Industrial Estate, Unit 10C South Marston, TNT at G Park and 110 Faraday Park at Dorcan.
The number of overall transactions was well above the long-term average with transactions taking place in all size ranges and many occupiers were being forced to look at locations further afield to towns such as Chippenham, says the report.
This was being made worse by the removal of larger buildings for alternative uses such as a new trampoline centre at Techno and a rock climbing centre at Groundwell.
As a result, overall supply dropped significantly and there was now an acute shortage of good quality large format accommodation.
Developer DB Symmetry is now promoting up to 1.2m sq ft (111,000 sq m) of new warehousing in two buildings at Symmetry Park, a 96-acre greenfield site off the A420, pictured above.
Two new speculative small unit industrial schemes – Glenmore’s at Westmead and Rockhaven’s at Kembrey Park – are both attracting a good level of interest from owner occupiers and tenants, says the report, with the focus now switching to potential new schemes.
Rents of £6.25 psf (£67 psm) were secured for refurbished second-hand space at Faraday Park, Dorcan, while Kembrey Park witnessed a steady improvement in rents with the take-up of five of its Birch units.
Swindon’s retail and leisure markets also strengthened last year.
Highlights included fashion retailer H&M relocating to a new 15,000 sq ft (1,394 sq m) unit at The Parade. The Brunel Shopping Centre secured planning permission for a 16,000 sq ft (1,486 sq m) food court.
The 97,000 sq ft Regent Circus scheme, which includes a state-of-the-art Cineworld cinema, Morrisons supermarket and five restaurants – ASK Italian, Coal, Gourmet Burger Kitchen, Nando’s and Prezzo – and opened in February and has since traded very well. There is now strong interest in the last two units.
McArthurGlen’s Swindon Designer Outlet, which attracts 3.75m visitors a year, opened its 50,000 sq ft (4,645 sq m) £35m extension and attracted Wagamama and Giraffe as well as 25 additional new stores. Bargain chain B&M occupied the 33,000 sq ft (3,066 sq m) former Homebase unit on Paddington Drive.
Plans for a major leisure development which will on land near the Oasis Leisure Centre were today submitted to Swindon Borough Council. 
Developer Moirai Capital Investments should receive outline planning approval for its £120m, 31-acre (12.5ha) mixed-use scheme on land near the Oasis Leisure Centre at North Star in the second quarter this year, says the report. The scheme, pictured, includes a 5,000-seat arena, cinema and ski slope along with an hotel, restaurants and shops and would transform the area into one of the UK’s largest leisure and entertainment destinations.
Discussions are continuing to secure funding for a new art gallery in the town centre, which would house Swindon Council’s collection of 20th century art – one of the the finest outside London.
