With businesses reporting increased orders, millions of pounds of investment incentives on offer and with major strengths in sectors likely to grow, the county’s economy is set fair as the recovery takes hold, according to the 2013 Kent Property Market Report.
The report, which reviews the county’s commercial, retail, tourism, rural and residential markets and its regeneration programmes, is produced by Kent County Council, leading international property consultants and chartered surveyors Caxtons, and investment promotion agency Locate in Kent.
It was launched today (October 17) at Discovery Park, Sandwich, which, with its Enterprise Zone status and state-of-the-art facilities for life science companies, is a key symbol of Kent’s potential for growth.
The report finds that while the county’s property market faced another challenging year in 2012, there are grounds for optimism as the economy shows signs of improvement. It highlights:
- More than £60 million being made available across the county from the Regional Growth Fund and other financial support programmes such as Expansion East Kent and TIGER;
- Major strengths in sectors likely to grow, especially in the life sciences, low carbon, environmental goods and services, advanced manufacturing, creative and digital and land-based sectors;
- Benefits coming through from major infrastructure investments of recent years, such as High Speed One;
- Major development sites in the Thames Gateway, Ashford and elsewhere in the county opening up some of the most significant investment opportunities in the region.
Mark Dance, Kent County Council Cabinet Member for Economic Development, said: “We know that businesses across the county are still coming to terms with the challenging financial environment – but the news of an emerging economic recovery is very welcome.
“We have made around £60million of government Regional Growth Fund money available through Expansion East Kent and TIGER in North Kent – and this is being picked up by firms now, creating jobs and growing business.
“I am also delighted to learn of the expected growth in creative, digital, high-tech, environmental and land-based sectors.”
On a positive note, there is growing confidence in Kent’s residential property market with average values increasing by 1.1% year-on-year to April 2013, just below the UK average, and an upsurge in demand from buyers has been reflected in an equivalent rise in land sales as developers secure sites.
Meanwhile, high streets in Kent performed well with average rents continuing their upward trend and outperforming the rest of the South East and the UK. Although yields saw little movement, the county still outperformed the UK average, while Leisure and Tourism’s contribution to the county’s economy grew by £200million to £3.4billion with 57 million visitors, supporting more than 65,000 jobs.
In other key areas:
- Kent’s Business Parks held their own during 2012 in terms of average rental growth and yields, but occupier demand remained light;
- The Office sector saw falls in average rents, although the rate slowed from -5.6% in 2011 to -2.6% in 2012. Yields suffered as investors sought safe haven investments, largely in London;
- In the Industrial and Distribution sector, rents fell, reflecting an over supply of secondary stock and lack of business confidence;
- Warehouse average rents fell by 1.2% to -0.02% after two years of growth, a positive position compared to a 1.5% drop in the South East as a whole;
Ron Roser, chairman of Caxtons, sponsors of the report, said he was pleased with the outcome of the research.
“Kent’s property sector is showing signs of growth, following what was undoubtedly another challenging year,” he said.
“Concerted efforts to attract new investment and support commercial growth are helping, with continued focus on unlocking major development sites in the county. Confidence is returning and there is buoyancy across the sector that extends from construction to sales and lettings, whether in the commercial or residential field.
“The Report shows that Kent is set to take advantage of the recent IMF U-turn on UK growth, published in its six-monthly World Economic Outlook, now forecasting a 1.4% increase in GDP by the end of 2013.”
Paul Wookey, Chief Executive of Locate in Kent, the county’s investment promotion agency, said it had been an encouraging year for the agency, particularly in respect of its pursuit of Foreign Direct Investment (FDI):
“In 2012-13, Locate in Kent helped 60 companies to set up, move to or expand in Kent, creating 1,363 jobs and safeguarding 1,065, and the first half of 2013-14 was also positive,” said Paul.
“Successes in 2012-13 included 15 overseas companies, many from the US, France and Germany – where we have recently appointed investment agencies to help us attract new prospects – but also from Denmark, India and New Zealand.
“Those figures, and the pipeline of interest that we have, support the Kent Property Market Report’s confidence that the county, with its first class infrastructure and financial incentives, is in a great position to make the most of the recovering economy.”
Paul Barber, Managing Director, Discovery Park, said: “We welcome the findings in the report and the results of the property growth in Kent can clearly be seen here at Discovery Park.
“We have celebrated two successful milestones in 2013, as the Park completed its first successful year and saw its tenant portfolio grow to 50 with over 1,300 staff employed in a variety of sectors such as life sciences, technology, business and manufacturing.
“As one of the Government’s most successful Enterprise Zones and the largest business park in the UK, it is fast becoming a leading science, technology and business hub.”
The Kent Property Market Report is also supported by Maidstone-based DHA Planning, Lloyds TSB, RICS South East, and Kent law firm Thomson Snell & Passmore.