Reading offers quality office space
By Alan Bunce, News Editor
Not long ago one of the biggest problems facing businesses seeking office space in Reading town centre was the shortage of Grade A stock. Lack of confidence, and sometimes funding, brought new development to a virtual standstill. Now there is over 750,000 sq ft of Grade A space either available or under construction, mostly centered around the redeveloped station.
Steve Head, Director at Hicks Baker, who has seen the Reading office market evolve over the last 30 years, says the ongoing infrastructure improvements are so significant they will take the town to another level. He said: “Ultimately it comes down the fundamentals of the Thames Valley as a business location. The key factors are good infrastructure, proximity to Heathrow, the cluster effect of major international businesses, availability of a skilled labour pool and, for research based industries, access to academic excellence in universities such as Reading and Oxford. “Add this to the emergence of a new generation of high specification, energy efficient office buildings designed to attract top quality occupiers and you have a very positive outlook.” “The fundamentals for Reading are strong and there are many reasons for companies to look positively at the town relative to many other locations.”
Major refurbishments completed over the last 18 months such as Abbey Gardens South, One Valpy Street, Phoenix House and Aquis House have increased the availability of Grade A town centre offices to over 300,00 sq ft. Then, over the next two years a new wave of completions includes:
180,000 sq ft at Thames Tower in late 2016
175,000 sq ft at Forbury Place , due for completion at the end of 2015
109,000 sq ft at R+ , also under construction and scheduled for completion in early 2016
In addition, Stanhope and Benson Elliott’s multi-use regeneration of Station Hill is yet to begin. It is widely expected that its first phase will add another 230,000 sq ft to the office pipeline. A date for this has yet to be confirmed.
Although the town still awaits the first major letting in the new space Mr Head is not overly concerned and says complexities of decision making in large organisations mean it is not unusual for there to be a long gestation period with significant relocations. He added: “The occupier market typically lags behind major investment side but reacts as the tangible proof of new office stock become evident. “However with the long term average of annual office take-up of around 350,000 sq ft, he says a step change in the local market will be needed for investors to see a return and for the market not to slip from undersupply to oversupply.
Mr Head also believes, as Reading grows in profile and strives to attract top national and international businesses, it has to accept it will be up against increasingly stiff competition. He said: “If you speak to business organisations such as the Chamber of Commerce and the LEP, Reading is not only competing with other centres in the South East, it is increasingly likely to be competing against the likes of Frankfurt and Paris.” Doubts over the UK’s future EU membership and the ongoing airports expansion debate also present uncertainties which he says need resolving. But on top of the town’s infrastructure he points to another aspect helping maintain the level of success. “One thing I have always said about Reading compared to many Thames Valley towns is that it has always been a well balanced and broad based local economy. “Different industries rise and fall at different times but there has always been a good balance in the town. From Reading’s traditional base of companies such as Suttons, Huntley & Palmers and Courage, through major employers such as Foster Wheeler and Prudential and now to the IT and pharmaceutical sectors, we’ve always had a good range across many business sectors.
“The number of major professional services companies with a presence in Reading is also significant and adds to the mix.” He added: “Economic sentiment, business confidence and property development have always been cyclical in nature but locations with good fundamentals will always be well placed and Reading certainly falls into this category. “Fundamentally it is a positive message. The level of investment made in Reading, not only from the developers – both commercial and residential – but also in terms of infrastructure with WRAtH (Western rail access to Heathrow), the station redevelopment and the arrival of Crossrail, creating capacity for growth which puts Reading in a position to take the town to the next level.”