In association with Caxtons, the Ashford Property Market Report is produced by Ashford Borough Council, and uses and updates Caxtons' earlier research from the Kent Property Market Report (2018) alongside newly researched data.
The report highlights that Ashford, one of the fastest growing towns in the South East, is currently enjoying a more positive property experience than other areas in the county.
With prime office rents at 25% above their pre-financial crisis peak; prime industrial rental growth of 38% since 2013; retail growth of 11% over the 12 months (to Q3 2018) and the average residential value up by 26% over the past five years Ashford is working hard and leading where others follow.
A recent Caxtons' retail update illustrates how Ashford, in particular, has seen falling town centre vacancy rates. The borough council's purchase and management of the now, near full, Park Mall shopping centre, together with activity across the wider town has seen positive and welcome results.
Caxtons is the major contributor to 'Kent Property Market Report', and seeks to provide intelligently gathered and useful information to those interested in the property market – whether local authorities, institutional or individual investors, commentators or property professionals.
Ron Roser, Caxtons' Chairman said "With our extensive knowledge of the Kent property market and history of researching and bringing to the fore vital information on the state of the sector across the county, we were delighted to collaborate on the new Ashford Property Market Report.
"By scrutinising the market annually then analysing, collating and publishing the results, we strive to deliver a barometer by which others can review and examine the property market, not only in Ashford and Kent, but also as a bellwether for the wider South East."
Recent key developments that have played in to the report's findings include the Commercial Quarter – the largest office block to be built in Kent for 20 years; the planned transformation of disused industrial buildings into The Coachworks, an inventive and inspirational mixed-use space; an expansion underway of McArthurGlen's Designer Outlet close to the Ashford International station, and at Victoria Point where a 120-bed hotel, apartments and retail units are being built all demonstrating that Ashford is a powerhouse of property investment and activity.
Furthermore Ashford is very accessible. High Speed-1 journeys to London take just 38-minutes and junction 10a of the M20 is due to open later in 2019, both of which add to the area's attractiveness for developers. This is resulting in exciting new schemes including a former railway works, due to become TV and film studios, upmarket homes and extensive green space.
To view the report visit Ashford Property Market Report 2018/19
(l to r) Ron Roser - Caxtons Chairman, Ross Murphy - Pagesuite, Tracey Kerly - CEO Ashford, Gerry Clarkson - Leader Ashford BC
The Ashford Property Market Report launch video
A short interview with Caxtons' Chairman, Ron Roser
Kent has not been immune to the downturn in the retail market. Overall, prime high street rents in the county have dipped -2.7% losing some of the gains made in 2016 and 2017. Towns at the upper end of the rental scale have struggled more as affordability dampens demand.
Kent average prime high street rent
Source: Cradick Retail
However, Kent also illustrates many success stories as town centres are reinvented in the face of this period of structural change. The first phase of Legal & General's £53m St James development in Dover, providing 14,586m2 (157,000 ft2) of new leisure and retail space opened in the spring, while the Spirit of Sittingbourne regeneration reached its first milestone this year. The impact of such schemes on rents inevitably takes time, particularly given the challenging backdrop. The potential impact is exemplified in Ashford where the vacancy rate has fallen following the borough council's purchase and management of the now near full Park Mall shopping centre, combined with activity across the wider town.
High streets are evolving their role with a greater mix of occupiers, aided by rental adjustments. In January
The latest Local Data Company research, undertaken for Property Week, shows Kent has seen a sharp improvement in occupancy levels (August 2018) when compared with the national average.
Average High Street vacancy rate
Kent 7.80% 8.90%
UK 11.30% 11.00%
Source: Local Data Company, August 2018
The county saw the two largest retail transactions in the south east in 2018- Royal Victoria Place in Tunbridge Wells sold to British Land and the Whitefriars Quarter sold to Canterbury City Council.
These deals contributed to Kent seeing 30% of all retail investment transactions in the south east in 2018 (Source: Caxtons).
Both transactions underline the potential opportunities seen in town centres where investors and local authorities work together to deliver a holistic long-term strategy for vitality underpinned by a robust and diverse economic base.
Director - Business Space, M25 East
The 2018 Kent Property Market Report launched on 1st November and reveals recent commercial activity is led by a powerhouse of small businesses and not, as in the past, by larger established companies and corporations, and discloses that that the level of businesses migrating to the county is rising.
The Report, researched in the main, by headline sponsor Caxtons Chartered Surveyors, is published in collaboration with Kent County Council and Locate in Kent.
The launch of the Report revealed many positive aspects to the property sector in Kent, but with echoes of national weaknesses caused by economic uncertainty and global trade deals being 'repositioned'.
Some of the findings in the Report reflect changing global trends:
Despite a national crisis on the high street, towns and cities across Kent have survived better than many. In the main this has been due to regeneration projects and management strategies, as well as increased town centre dwellings, which have all contributed and underpinned the life of some of Kent's conurbations.
In parallel with other counties, Kentish towns have lost major players from the roll call of well-known high street names. Conversly, this has provided opportunities allowing independents and new enterprises to enter the market and occupy prime positions that they could not have considered in the recent past. Having said that, towns with higher rental values are not faring as well and struggle to achieve financial expectations.
However, the Report highlights that the diminishing attraction of high street retail has had a knock-on for those who feed the purchasing frenzy of online shopping. The industrial sector has been the beneficiary and there distribution space is in high demand. Both Amazon's 34,000m2 last mile sorting centre in Medway, scheduled to open before the end of the year and Ocado's plans for a 1.92ha site at Littlebrook are a perfect illustration.
Good performance in the wider market has impacted rents, pushing them up by 24% in five years as well as increasing speculative development.
Some offices to residential conversion has made space more difficult to find, but in general the Report reveals that the office sector
Whilst business parks have seen a small fall in rents, this has attracted SMEs and incomers new to the country into any vacant space even though average prime rents are 5.4% ahead of the market peak in 2010.
According to the Report, high quality skilled labour has been instrumental in attracting new businesses into the county with the residential construction market playing a major role.
In 2017/18 the number of new homes completed across Kent rose by 7.3% on 2016/17 figures and there was a sharp upturn in the number of units with planning consent or in the planning pipeline.
With housing stock increasing, the supply and demand chain has been restrained with overall prices rising by 3% and more affordable areas such as Thanet (7.4%), Dover (5.2%), Canterbury (4.7%) and Swale (4.7%) seeing the highest uplifts. Only Gravesham saw a fall in prices, down by 0.4%.
Chairman of Caxtons, Ron Roser, said: "What really comes through in this year's report is just how commercial property activity is being driven by the needs of micro and small businesses rather than large corporations. It's also good to see more space being occupied by companies moving into the area.
"In many areas of the county, the increasing involvement of local authorities in both commercial and residential property development is helping to make a real difference, especially where there is less appetite from the private sector.
"With developers, planners and local authorities working together, much is being achieved. This can be seen out on the ground where infrastructure, housing, regeneration and commercial developments are all coming forward."
KCC Cabinet Member for Economic Development Mark Dance said:"Whilst the economy has been relatively resilient over the last 12 months – despite Brexit and potential trade wars – the report shows us there are wide variations in the performance of individual sectors of the economy.
"Kent remains and is increasingly, a business location of choice with strong letting figures in the town centre office market.
"I'm in no doubt that times are getting tougher, however, particularly in the retail sector, but town centres are changing and Kent has seen a fall in vacancy rates contrary to the national trend.
"I believe Kent remains resilient with a business environment seen as favourable to investment with major initiatives and projects to support growth and economic development in our county in the coming year."
Gavin Cleary, CEO Locate In Kent, said: "The 2018 Kent Property Market Report mirrors what we are seeing on the ground with businesses and people attracted to Kent because of its affordability, connectivity and quality of life.
"From the booming food and drink industry to globally focused manufacturing and a growing creative and digital sector, Kent and Medway is quickly becoming the go-to location for business success.
"With the regeneration and investment in towns and communities across the county from Ashford to Canterbury, Medway to Folkestone, we have all the ingredients in place for a future-facing and thriving, vibrant economy."
The Kent Property Market Report is supported by RICS.
For more information and to download a copy of the 2018 Kent Property Market Report, visit Kent Property Market Report 2018