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Like many town centres across the country, Kettering’s is littered with familiar retail stores selling well-known brands, a smattering of independent shops - all battling to survive the drop in consumer spending says commercial property agent Prop-Search.
This slump in confidence was no doubt one of the contributing factors when UBS Wealth Management decided to sell the Newlands Shopping Centre earlier this year. At the beginning of the summer, the 200,000 sq ft mall was purchased by specialist investment manager Ellandi for a reported £36 million. This is about £2 million less than the asking price and reflects a yield of around 8.5%.
It is hoped that the new owners will further invest in the Centre to redevelop it in-line with previous discussions to expand the accommodation by approximately 40,000 sq ft - on the land used as a car park behind Gold Street and next to Tanners Lane. If this development was to go ahead it could create larger units, a requirement of many of today’s modern businesses, which has previously been heralded as a stumbling block when trying to attract new retailers to the town.
As part of the wider regeneration of Kettering town centre, £2.2 million has been invested on the Market Place, transforming a previously under used area into a vibrant place for people to meet and eat. This has been paid for entirely from funding attracted from outside of the Borough, known as the Growth Area Fund, as well as £560,000 of investment directly from the Homes & Communities Agency.
Market Place forms the focus of the new restaurant quarter due for completion later this year, built on the footprint of the old Market Place buildings demolished in 1908. The new buildings comprise restaurant accommodation totalling 9,000 sq ft with space for al fresco dining covered by glass canopies, and 10 high quality apartments with residential parking being provided a basement level. The makeover has included the creation of an amphitheatre, a covered performance area, tree planning, fountains and a timeline of the town’s history.
Works on nearby Horsemarket have recently been completed which now provides an improved pedestrian environment for shoppers and businesses. New bus stops have been installed, with the area becoming the main terminus for people coming into the town using public transport.
The area is also benefitting from further investment on the derelict Hogs Head site which has blighted Horsemarket for more than a decade. The long awaited demolition and site clearance of the former pub building has enabled partners to bring forward proposals for a new mixed use scheme, offering a ground floor retail unit of 4,000 sq ft.
There is an improvement in the local industrial market but this is tentative like so much of the wider UK recovery in the economy. The largest leasehold transaction to have taken place on Kettering Venture Park has been the letting of 2200 Parkway for LaSalle Investment Management, advised by Prop-Search. A five year lease has been signed by VP Packaging, one of the leading European packaging manufacturers for a 24,492 sq ft unit. The 65,000 sq ft Parkway scheme is now fully let.
Global property group Goodman has sold a 464,000 sq ft distribution warehouse at Magnetic Park, Desborough to the private equity real estate investment firm, Cabot Properties. The building, which is occupied by third party logistics company Great Bear, has been sold for around £25 million.
Also on Magnetic Park, Sainsbury’s is awaiting the decision on its latest application to build a new 21,450 sq ft foodstore, creating up to 200 full and part-time jobs. The supermarket giant has been refused planning twice on the scheme which includes a petrol filling station and 241 car parking. The latest proposal also includes a foot and cycle path linking the site to Harborough Road, screens for the service yard, increased landscaping and a redesign of the building’s roof.
Whilst the difficult economic climate has impacted on the commercial property sector, 2011 has seen increased activity over the previous two years and a major issue now arising will be the supply of stock within the market place for those companies in a position to expand or relocate. This scenario is not limited to Kettering but prevalent to the County and it is ironic that a possible improvement in the economy could be frustrated by such a shortage.