Commercial property market activity in Oxfordshire was dominated by the science and technology sector in 2018, according to VSL & Partners' property report.
There is universal agreement among the property profession that 2018 was a quieter year and this is born out of lower take up figures, however the previous year had been the strongest year in a decade and rents are still climbing, said the firm.
Both office and industrial take-up declined by 35%, just below the five-year average. Supply of available buildings in Oxfordshire dropped marginally with a reasonable level of new-build stock entering the market to balance the figures.
Richard Venables, director at VSL explained: “The most striking change is the amount of space taken up by the science and technology sector in the industrial sector which has increased from 23% in 2017 (266,000 sq ft) to 65% in 2018 (486,000 sq ft). In the office sector this has remained steady at around 65%.
“These figures continue to show the importance of this sector but also how science can adapt to all types of property. Industrial units often provide a more flexible and cost-effective solution allowing for an easier fit out.
“Many of the technology spin-out companies' desire to stay in the centre of Oxford for access to University departments and employees. We are now finding that they are prepared to look further afield to the ring road and beyond. Ultimately this is dictated by the fact that there simply isn’t the stock available in the centre of Oxford and any new schemes are still some years away.”
The co-working revolution has gathered momentum in many cities but Oxford has not picked up on this trend yet. There are examples such as The Foundry, but this is reserved for University students. WeWork or similar has yet to find suitable premises in Oxford although there is still a good supply of traditional serviced offices. Once again it is lack of central Oxford stock that limits growth in the co-working sector.
Looking forward to 2019, we think that the hi tech momentum will keep going. A number of deals were put in solicitors hands in December indicating a positive start to the year and we predict take up will exceed 2018 with rents continuing to rise.
The VSL annual report provides an analysis of the office and industrial market focusing on central Oxford and the A34 ‘Innovation Knowledge Corridor’ for offices from 3,000 sq ft and above and industrial from 5,000 sq ft and above.
VSL has continued its dominance of the Oxford commercial transaction market, transacting 12 office deals equating to 38% of total take up and 19 industrial deals equating to 42% of the total market take up.
In 2018 VSL was named for the ninth year running as Oxfordshire’s most active agent and dealmaker of the year by EGi and this year VSL won the inaugural CoStar Oxfordshire top performer award.