Big investments boost Derby and Derbyshire property market

A new report by Innes England has found that despite the challenges of Covid investment in Derbyshire’s commercial real estate sector more than tripled last year.

The property agency’s latest Market Insite report, found that investment in this sector reached heights of £380.5 million.

It also said that Derby was the leading East Midlands target for retail investors, soaring to more than £99.1 million of investment – driven by large retail park and supermarket schemes.  

Another highlight in the report, which closely monitors trends in the regional property market, was that both footfall and spending in Derby was above pre-pandemic levels, with footfall is up by two per cent.

Key deals included the acquisition by Frasers Group, formerly the Sports Direct Group, of 127,000 sq ft in the Derbion shopping centre.

There were also successes at Derby Commercial Park, with the letting of 515,000 sq ft to JD Sports and Ares Management LLC’s £70.7 million purchase of the Kuehne and Nagel logistics warehouse.

Overall, Derby’s industrial take-up increased by 50%, despite low levels of supply, particularly with second-hand stock.

The report said that supply was the key factor in keeping the industrial market moving.

Nick Hosking, director of agency and development at Innes England, said: “This is changing, with St Modwen committing £46 million towards the initial phase of St Modwen Park Derby delivering 300,000 sq ft of speculative product, which will be available for occupation in late summer to meet a much-needed gap in the market.”   

Derby’s retail investment level of £99.1 million was a six-fold increase on the previous year and nearly 50% on the five-year moving average.

Notable deals included Threadneedle’s £22.5 million purchase of Wyvern Retail Park, Melford Capital Partners’ £30.8 million purchase of the Meteor Centre Retail Park and Aberdeen’s £31.5 million acquisition of Sainsbury’s supermarket in Ripley.  

Finally, the Market Insite report revealed that Derby saw a 43% rise in office take-ups from 156,000 sq ft to 224,000 sq ft last year.    

Nick said: “In Derby, there were good lettings to DHU at Orbis 1 on Pride Park, taking 41,000 sq ft and towards the end of the year a further 13,000 sq ft.

“There is no Grade A accommodation presently available within the Derby market, although overall supply has been helped by Rolls-Royce bringing the 73,000 sq ft Jubilee House to the market.  

“With the lack of Grade A space now, there was strong take-up of good quality Grade B standing stock, particularly out of town on Pride Park and the Wyvern. Activity was strongest within the 5,000 to 15,000 sq ft range.”