Key commercial premises takeaways from the Kent Property Market Report
Unless your business is run entirely from home, you will need commercial premises of some sort – be it an office or co-working space, industrial building or warehouse. Choosing the right commercial property is important to your company’s bottom line and to your staff, both attracting them and keeping them.
The sole trader
Sole traders might be used to working from home, but it can be lonely for some. As a result, they may want to consider options for a cost-effective office base where they can interact with others but not be tied into costly long-term contracts.
On the other hand, they may be thinking of taking on staff for the first time. If this is you, how about using a co-working space or a serviced office which offers ‘easy-in, easy-out’ options where rent is inclusive and paid for on a rolling monthly basis. These types of premises are often more friendly, supportive and collaborative than other arrangements too.
As is the case nationally, co-working has become very popular in Kent. Searches on the Locate in Kent portal for coworking spaces were up by 17% year-on-year from 2022-2023 to 2023-2024. The Kent property sector has responded to the demand, and now there are more than 170 such spaces in Kent, with all Kent towns and many villages now having their own space, and more are being provided every year. A full list can be found on page 27 of the Kent Property Market Report 2024.
The downsizer
On the other hand, your company may already have an established office and need less office space due to continuing hybrid working or more space because of growth. If you now need less space, traditionally, the company might sell up and purchase a new office, or in the case of renting, especially if you were towards the end of a lease, give up the lease and find a smaller office.
This may be what is needed but can be expensive, especially by the time legal expenses, the cost of ‘dilapidations’ and moving costs are considered. What’s more, finding an office in a suitable location can be challenging. An alternative, if you own the property, is to sub-let. This may also be an option if you rent, but you will need your landlord’s permission. They may be happy for you to do so – especially if you have been a good tenant. This has many advantages, especially lower costs.
The upsizer
If your company is expanding, again, the only option may be to move unless your landlord can offer you more space or you own the building or space and can extend, perhaps by adding a mezzanine. But maybe with hybrid working, you don’t need more space but could use the space you have more efficiently. An office fit-out company will be able to help you re-plan your layout to suit modern ways of working. A new fit-out is nearly always going to be more cost-effective than moving.
What an employee wants
Recent evidence shows that employees who are office based (even if only for part of the week) or those who are seeking a new role, are looking for flexibility, but also a wider range of staff facilities – whether that be better kitchens/staff rooms, more relaxed spaces for working collaboratively or even gyms and exercise equipment. A good working environment is essential if you want to recruit and retain good staff, which is fundamental to running a successful business.
Where to relocate?
The Kent Property Market Report shows that office rents are fairly flat in most towns, though some with a shortage of quality stock like Sittingbourne and Ashford have seen increases. At an average of £12.50 per sq ft, rents are currently competitive, though some rents in the western half of the county have reached £42 sq ft. It is likely that office rents will rise next year so now may be a good time to look.
In most cases, if you decide on serviced offices, professional advice is probably not needed other than to get a solicitor to look over the lease/contract. In every other case, getting the appropriate advice is essential to ensure you are making the best choice and have all legal points covered.
The industrial and warehouse story
While demand and rents for offices are largely flat, this is not the case with industrial and warehousing facilities. This sector has seen rents rise steadily since 2015, partly because of a historic lack of supply. Average rents sit at £12 sq ft, not far behind offices, though in Dartford, they are nearer to £17 sq ft. If you are considering a new unit, you need to look particularly at location in relation to your markets, size, eaves height, storage facilities and office space.
Since the pandemic, a lot of new space has come on-stream across the country but especially in Maidstone and Aylesford, with large sites such as Loc8 near junction 8 of the M20 and Click Aylesford and Panattoni Park Aylesford.
Some of the largest speculative warehouses in the South East are currently being offered in Kent, and work recently began on the largest speculative property development in Kent in more than a decade. A total of 644,000 sq ft of development is underway at Panattoni Park, near Kemsley, previously called G-Park Sittingbourne. This site will eventually create a net-zero carbon logistics park offering a total of 773,000 sq ft. The entire phase 2 of the development is already pre-let to DPD.
Of course, there are plenty of smaller units across all towns and areas, both new and older, with the latter often suitable for those looking for a lower rental cost.
