NOTTINGHAM IS A KEY PLAYER IN THE UK ECONOMY

NOTTINGHAM is enjoying a particularly prosperous period and in terms of wealth creation, the city is currently fifth in England, ahead of both Bristol and Leeds.

Nottingham is also an expanding city, both physically and economically. As well as retaining its prominent position in the UK retail rankings, the city is experiencing significant economic growth – specifically in the high value added business and professional service sectors.

While residential development has been a key catalyst in the regeneration of the city centre, the central office and retail markets are set to be transformed over the next five to ten years – while the city’s population is set to grow by 32,000 in the period up to 2021.

These are just some of the findings of the Central Nottingham Property Market Activity Report which was revealed to more than 100 business people today (Fri 8 Jun).

Commissioned by Nottingham Regeneration Limited (NRL), the company tasked with helping to drive forward the city’s regeneration plans, the work was undertaken to find out what sort of changes the city and the wider conurbation can expect over the next decade.

Liam Bailey of Knight Frank, which carried out the research, said: “What is clear from the report is that Nottingham is about to embark on its next exciting phase of growth and evolution. The city has already experienced huge success in city living, a trend which is now being seen repeated across towns and cities across the country.

“But what will benefit Nottingham even more are the current development proposals for major new office schemes, the redevelopment of the Broadmarsh Shopping Centre, and the exciting new leisure facilities currently under construction in the city centre.”

Marc Cole, Nottingham Regeneration Limited’s chief executive, said: “This is a very exciting time for Nottingham as it looks forward to a decade of sustainable, physical and economic regeneration. The report shows that the city has laid the foundation for its renaissance and NRL is working with partners to build on this success and take full advantage of the growing opportunities across the commercial, retail and residential property sectors.”

Summary of findings

• Nottingham is an expanding city, both physically and economically. The city is experiencing significant economic growth, specifically in the high value added business services sector.
• Development in edge of centre locations have been the prominent form of office activity in the city in recent years, however several major office schemes are in the pipeline for the city – an estimated 2.2 million sq ft of floor space will be provided over the next five to ten years which will transform the central Nottingham office market
• Nottingham has secured a massive redevelopment and expansion of the Broadmarsh shopping centre by Westfield that will secure and enhance Nottingham’s reputation as a great retail destination
• In the year to September 2006, more than 900 dwellings were completed in central Nottingham. A total central Nottingham pipeline of more than 3,500 homes is an indication of the confidence developers have in the growing city centre market
• Nottingham has a higher than average percentage of its workforce employed in knowledge intensive industries. The designation of Nottingham as one of six Science Cities recognises the city’s existing strengths and pre-eminence in research and its potential for growth in science and emerging technologies sector.

Office Market
The central Nottingham office will be transformed over the next five years with several major schemes in the pipeline amounting to an estimated 2.2 million sq ft of floor space. NG2, the one million sq ft mixed use scheme on the south-west edge of the city has already helped lift the Nottingham office market, setting a new prime rent for the city, breaking the £20 per sq ft barrier.

Retail and leisure market
Prime retail rents have increased steadily over the last three years to a level of £245 per sq ft. Westfield’s significant investment in Nottingham through the £400 million redevelopment of the Broadmarsh Centre shows developer confidence in the strength of the city’s retail market. Looking to the future, it is vital that Nottingham continues to compete with other cities which have already sought to improve their offer, such as Birmingham.

In terms of leisure activity, the report highlights the importance of The Axis, the £50 million mixed-use development in Upper Parliament Street with its 70,000 sq ft casino and residential and retail units – and The Pod, the new retail, hotel and leisure complex behind the Lace Market tram stop.

Commercial investment
Having already experienced significant yield compression due to a highly active market, the strength of investor demand for commercial property in Nottingham is expected to underpin secondary yields and hold them stable in the coming 18 months, while there remains potential for further compression at the prime end of the market.

City living
The population of Greater Nottingham stands at 637,000 and is forecast t grow by more than 32,000 in the years to 2021. During this time, demographic changes will see strong growth in the over-50 age group and a decline in the population of younger age groups in the city.