Expert View: The future of the commercial property market in St Albans and Harpenden
- Credit: Archant
What does the future hold for the commercial property market in St Albans and Harpenden? Matthew Bowen of Aitchison Raffety shares his thoughts...
With so much unknown about when and how lockdown restrictions will be eased, the future is very hard to predict for commercial property. But from what we have seen so far and our experience we are able to give some likely impacts and outcomes.
Restaurants, pubs and the wider leisure market are undoubtably going to be the hardest hit sector. Revenue is determined by the volume of customers and until this returns to ‘normal’, the viability of these businesses will continue to be impacted.
Whilst the government has helped with business rates relief and by allowing restaurants to do takeaways, a restaurant that’s only able to have half the amount of covers may not be profitable or even worth opening unless fixed costs such as rent can be reduced. Some large chains were struggling before the crisis and a number are unlikely to survive.
Across retail generally, it will be a similar problem as revenues continue to be impacted by the restrictions on numbers of people allowed into stores. Again, the larger chains may be harder hit and niche businesses that we see in areas like St Albans and Harpenden may be less affected. There will also be a built up demand from shoppers keen to purchase items they have held off buying during lockdown.
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Industrial property has been affected the least, as online orders have increased - and with less people usually in these types of buildings, safe working is easier to manage. Demand is very strong and there is still a shortage of buildings available.
Offices remain an unknown quantity in terms of what companies’ size requirements will be in the future. With present social distancing guidelines, most offices wouldn’t currently comply, but this will change as restrictions ease.
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Home working is likely to continue to be encouraged, which may mean that companies can reduce the size of their offices in the long term.
One of the biggest impacts is likely to be the relocation of offices out of central London; we have already seen a number of sizeable requirements from businesses looking to do just this. People are less likely to want to return to work if they have to travel on public transport, and areas where there are good connections to the rail and more importantly the motorway network will be likely to see an increase in demand.
This is very good for centres such as St Albans where there is now availability in buildings such as 45 Grosvenor Road (up to 60,000 sq ft). The knock-on effect is that, with more office workers in an area, there will be more demand for retail and restaurants - and increased trade will speed up the recovery.
This will mean Hertfordshire will fare better than most. Certainly, there will be challenges, but the attractive towns and cities here will bounce back and in the long term could thrive.
To speak to Matthew or a member of the Aitchison Raffety team, call 01727 843232.