A resounding vote of confidence in the viability of the business
parks in the Thames Valley has come with the Singapore listed
Frasers Centrepoint lining up to buy a portfolio from Oaktree
Capital Management and Patrizia.
The jewel in the crown is the 85 acre Winnersh Triangle, which had
originally been lined up for a sale to a new company, Capreon.
The portfolio, which is worth around £900 million, also includes
Watchmoor Park, Camberley; Chineham Park, Basingstoke; Birchwood Park,
Warrington and Hillington Park, Glasgow.
The market view is that the buyer will break up the portfolio and sell
the parks separately.
One of the dominating sectors
in the Thames Valley is
accounted for 30% of the take
up in 2016.
Indeed, Savills report that the
region has the highest concentration
of life science employees and companies
in the UK. In the first quarter
pharmaceuticals accounted for 9%
of the take up in the south east.
UK companies only accounted for
28% of transactions, while the US
groups took 63,689 sq.metres
.) last year, or 41%
of the total.
Simon Preece of Savills commented:
“The pharmaceutical industry received
£519.7 million in investment last
year, following the £1.48 billion of
2015”.There is a problem, however,
with the impact of Brexit. According
to a report by Brick Vest, 60% of
institutional investors quote Brexit
uncertainty as their biggest
challenge in relation to investment
in European real estate.
Looking ahead, Savills predicts
that there will be a greater emphasis
on pharmaceutical clusters as co-
operation between companies and
big data analytic providers become
crucial to improving efficiency. Savills
cites the Thames Valley Science Park
as one place where this is
Commercial Property Register
October 2017 - February 2018www.compropregister.com
Resilience is the key description
for the region’s market as it
weathers the uncertainties of
Brexit and the impact on the
That is the view of Lambert
Smith Hampton (LSH) in assessing
the current situation after a year
in which take up was below par
with a decline of 19% to
157,930 sq.metres (1.7 millionsq.ft
in 2016 compared with the
Nick Coote of LSH said: “Within
the context of the Thames Valley
office market, this has remained
remarkably resilient in both the
occupier and investment markets.
However, there are some fundamental
changes in occupier demand”.
What shines out from the report
is that Oxford, Reading and Staines
have outperformed their longterm
averages. Bracknell has had a
strong first quarter while Oxford has
continued its strong showing.
The significant change taking
place is the shift to small space
requirements in the range of up to
929 sq.metres (10,000sq.ft
is because of companies cutting
costs through shared space and the
increase in the number of SMEs.
At the same time, supply has
continued its six years’ decline to
a current 817,520 sq.metres
.), or 4.5 years’
supply. These figures hide another
important change; the near
disappearance of Grade C space
and the decline in Grade B,
mainly because of conversion to
In contrast, Grade A space has
increased and is providing the type
of buildings the tech industry
wants, also bringing higher rents,
a feature in most towns.
LSH expects a quiet market
ahead because of political and
economic pressures but notes
the rising demand from small
companies and the impact of
Crossrail (Elizabeth Line). For
example, the new line will more
than double the working population
to 6 million within a one hour
public transport travelling time
While Cambridge is usually
called Silicon Glen, the Thames
Valley has a claim to be the Silicon
Valley of the UK because of the
number of large tech companies
(such as Cisco, Microsoft and Oracle)
who reside there, apart from the
high percentage of people working
in the industry.
For example, a report from Tech
Nation said the tech industry in
Reading had grown by 57% in the
period 2011-2015 while in Oxford
the growth was 43%. Reading is
second only to London in the digital
economy at £12.5 billion employing
Thames Valley Science Park
office providers are expanding in the Thames Valley, particularly
Regus, who have now opened another business centre in the Gatehouse
building in Aylesbury, following their recent expansion at Heathrow’s
Terminal 2. Regus said that the Aylesbury building is “at the heart of the
thriving Thames Valley”.