News Article

Logistics Park on Right TRAC

04/09/2008

THE HERALD (COMMERCIAL PROPERTY)

Huge development offering flexible packages has attracted its first tenant. Specialist engineering firm TRAC International is to be the first tenant of the newly completed Central-point logistics park at Eurocentral.

The firm, with bases in Aberdeen and Inverness, has taken a l0·year lease on the 41,266 sq ft Athena industrial unit, with dedicated office space. Karen Campbell of the developer TAL CPT said:

“Securing a letting of this magnitude so early in the creation of this scheme is of significance, especially given the market conditions. The Enterprise Zone status here allows us to offer attractive incentives packages on newbuild industrial units which range from 53,434 to 122,483 sq ft. “Centralpoint is a development in the heart of a growing business complex and we are confident that, with the secure park environment and linkages to Maxim Office Park, 15,000 sq ft of retail space and world-class business park, we will attract further tenants".

In a move with parallels to the way the adjoining Maxim is about to flood the office sector of the market, this industrial scheme will provide 423,660sq ft of new space across six buildings. Within the cushioned tax environment of an EZ, these shiny new sheds can be offered at a rental of £5.25 to £5.75 per sq ft, with incentives, at a time when smaller-scale industrial developers are struggling to make speculative projects work.

As well as a good product, the venture has some enthusiastic agents in CB Richard Ellis' small team, which acts jointly with Ryden in finding occupiers. In what is a fairly flat market, David Rolwegan and Jamie Cumming have managed to handle around 220,000sq ft of space since the start of the year. Rolwegan revealed that the next building up in size from Athena, a 53,293 sq ft property called Apollo, is currently under offer, this time for more of a storage and distribution use. Cumming stressed that they were looking for a range of uses:

“These units are adaptable and I don’t think it would be good for the development to be exclusively distribution - it is good to see engineering, manufacturing and warehousing and some diversity.”

Rolwegan said that, although Centralpoint is very much its own development, with manned security gates, the occupiers can link into the retail and leisure facilities of Maxim being built next door, and said this was a factor in securing the two tenants:

“People like their staff to be able to walk through and buy a sandwich rather than have to go the local burger van. There are parties out there looking at a combination of warehouse and office space, and if we can tie both up on site, it works for everybody. CBRE is encouraged by the situation at Eurocentral, where they also handle the four other new industrial units plus the nearby 71,700 sq ft high-spec Artemis warehouse, which has 10m eaves and is available on flexible lease with up to 12 months rent-free. There are also design-and-build plots, from 20,000 to 500,000 sq ft. “We have five proposals out for these plots for new manufacturing and distribution facilities, and this has all happened within the past year,” said Cumming. “That is encouraging. Some are moving because of changing technology in their industry. They don‘t want to be left behind. There can be high cost implications but in the long run it is worth doing”.

The small team at CBRE which, earlier this summer, along with DTZ, leased the 50,000sq ft VistaPoint warehouse at Hamilton to Kuehne & Nagel for drinks distribution, has another of Scotland’s biggest instructions — the giant MAX warehouses at J4M8 Bathgate. At 380,000 and 240,000 sq ft, these Evander properties are the largest speculative industrial units built here and were completed last November.

Though there are no takers to date, there remain a couple of large supermarket distribution requirements for which these will be a contender. Now that the Co-op has resolved its takeover of Somerfield, it may be able to move forward on its distribution network. Rolwegan is also able to list smaller industrial deals this year. At Blairlinn industrial estate in Hamilton, 14,279 sq ft was sublet to PVC window manufacturer CMS Enviro Systems at a rental of £5. At Glasgow Airlink, a 4497 sq ft unit was let to propeller firm. Wartsila UK at £4.25. At the Roundel, Middlefield Industrial Estate, Falkirk, recently acquired for Kilpatrick Property Group, a vacant 3320 sq ft unit was let to Dingbro at £l6,000 per year and there is interest in refurbished space for trade counter use.

“In what is allegedly bad market, we are doing pretty well,” said Rolwegan. “It is tough but things are still happening. The industrial market may be quiet but we have noticed that the people we see are more focused on acquiring space and there are more genuine inquiries and fewer time-wasters. “We do have to be patient in acting for landlords, but many believe they have a great product so see no need for that to be heavily discounted. A good product will eventually find an occupier.”

The agents are hoping to add smaller and older stock to their portfolio over the coming months.