Out of town is place to be for industrial lets

"FLIGHT TO THE SUBURBS" is a term used to describe the process by which mainly lower middle class families desert the inner city.

The phenomenon is largely unknown in Edinburgh, where the high-density but relatively affluent residential areas formed at the turn of the 20th century are as popular today as they were then.

Yet to some extent what has happened, in residential terms, to some cities south of the Border has been reflected in the capital's industrial property sector. To giants such as Parsons Peebles, Brown Brothers and Robb Caledon can be added a host of smaller manufacturers, contractors and repairers that have been lost to the city.

In many cases this was because the residential property boom made their modest land holdings infinitely more valuable than the businesses themselves – and made relocating beyond the boundary a no brainer.

Consequently most of the industrial property development in the Edinburgh region over recent years has taken place not within the city itself but beyond the bypass, which, apart from the western fringes, marks the boundary of the pre-1975 capital.

According to David Fraser, an industrials specialist at Ryden, statistics for the financial year just ending will show the best take-up of industrial properties in the Lothians for the past five or six years, although he admits this is based on volume of lettings rather than the total amount of square footage let.

Rental rates are holding up well, a combination of demand and new development being limited by the wider financial situation and a relative shortage of sites. With borrowing tight, only cash-rich companies are prepared to build industrial units speculatively – although even in the boom times speculative industrial schemes were small in comparison to those involving business space.

Fraser's colleague, Alan Heriot, offers as an example of the current buoyant mood the experience of two portfolios within Bilston Glen Enterprise Park at Loanhead in Midlothian.

In about 12 months, Ryden has let five industrial units, extending to 9,500sq ft in total, on behalf of the locally owned Sharkey Group. The tenants are Nanoparticulate Surface Adhesive, Solutions Group, Swan Business Solutions, PPE Industrial Supplies and Nichols Boyes Stone Conservation.

The properties have been let on a variety of terms, ranging between three and ten years, with rents at a tight 6 to 6.50 a sq ft.

Sharkey acquired the former Peter Walker HQ site at Bilston Glen in 2007 and subsequently refurbished the space to provide serviced office suites. Later, despite the economic downturn (or perhaps because of it) the industrial units were developed speculatively on a surplus yard area.

Ryden is also agent for another portfolio elsewhere on the park. This comprises 17 units, completed in late 2008, all but one of which have either been let or sold to firms keen to be owner-occupiers.

The success at Bilston Glen is being replicated on industrial sites in West and East Lothian that are also relatively close to the city bypass.

Rents are, typically, 6 to 6.75 a sq ft, normally for accommodation ranging from 1,000 to 2,500sq ft; however, demand for premises up to 5,000sq ft is said to be running at a good level.

Greggs ventures into business park

GREGGS has taken a 15-year lease on the shop unit at Innovation Park, Bellshill, Lanarkshire, at an initial rental of 8,000 a year following the Newcastle-based bakery chain's strategy to extend its town centre outlets to business parks and industrial estates. Office occupiers at Innovation Park include Guardian Media Group, Lloyds TSB and Balfour Beatty. DM Hall acted for the landlord, Edinburgh-based Cosmopolitan Investments, while Greggs was not represented.

DISTRIBUTION and outsourcing group Bunzl UK has taken a ten-year lease of a 25,000sq ft warehouse at Imperial Park, Linwood, at a headline annual rent of 125,000 a year, with a break option at the end of year five. Bunzl previously occupied premises in Barrhead. CKD Galbraith acted for Bunzl UK, FG Burnett and Knight Frank for the landlord, the Lear Group.

DIAL-A-JOURNEY, the provider of door-to-door transport for people with mobility problems, has acquired a 9,334sq ft facility on Springkerse Industrial Estate from Stirling Development Agency. The premises were bought for 575,000 through joint selling agents, Colliers CRE and Ryden.

THE Bonsyde House Hotel in Linlithgow has been purchased off a guide price of 495,000. This 19th property comprises nine en-suite bedrooms, lounge bar, conference room and conservatory restaurant. The business was previously owned by the Eshiels Partnership and the new proprietors are Mr and Mrs George Ninan. The selling agent was Chrstie & Co.

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• A MARKETING brochure issued last Thursday by independent consultant Craig Watson, former of NB Real Estate and Knight Frank, stated: "Designed by Enric Miralles, this iconic building was completed in September 2004. The quality of finishes are such that the original budget was revisited to make marginal improvements to the original concept. Formerly used as a brewery, any issues from this use have been dealt with, however it's more recent use has meant that excess amounts of oral methane have been produced and full investigations will be required to satisfy any purchaser."

If this prose did not give the game away then the accompanying images should have; they were of the Scottish Parliament building, being offered for sale by the property company Lofa Pirol – an anagram of April fool.

Watson insists he received two serious inquiries before noon.