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Property Market Review

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Property Market Review Property Market Review 1.1 This report is to provide a commercial property overview of Northampton for the Design, Development and Movement Framework. The main basis of the report will be an examination of the key property market sectors relevant to the town centre. Throughout this review we will aim to give particular consideration to opportunities and constraints in the different sectors specific to the Northampton area. Background 1.2 Northampton was designated a ‘new town’ in 1968, and is continuing to grow rapidly (Promis Property market Analysis). This has been reinforced Northampton being placed at the heart of Area Growth initiative determined by the ODPM, which could potentially increase the area’s population by 50%. 1.3 Northampton town centre currently has a reasonable retailing offer, with the majority of the main stream multiples present. Engineering is a key industry in the town. There is also a moderately developed office sector with a number of business parks in out of town locations (and a large distribution industry is growing in the region). 1.4 In order to ensure Northampton becomes a more attractive destination and continues to meet the needs of its growing population, this report aims to identify the development opportunities in the retail, leisure, office and industrial market in the town centre. Demographic and Socio Economic Factors 1.5 Northampton has a district population of 194,458 (Office of National Statistics, 2001 Census). In 2001 the Northampton area, contained a moderately above average proportion of working age adults (those between 18 and 44). There was also a relatively high proportion of children aged 0-14 and an under-representation of those ages over 65. This suggests a relatively youthful population. 1.6 Promis Live Property Market Analysis (Promis) predicts that Northampton will see above average economic growth over the period 2004 – 2009 at 0.5% per annum. This supports the 2003 area growth initiative. 1.7 The population in the Northampton area is classified as ‘moderately affluent’ by both Promis and the Focus Town Report (Focus). The class groupings in comparison to the UK average are shown in the graph below: C:\Documents and Settings\DBlandamer\Local Settings\Temporary Internet Files\OLK1F4\Property Market Review.doc 2001 Class Groupings (%) 35 30 25 20 Northampton District % 15 UK 10 5 0 AB C1 C2 D E Class Groupings AB. – Higher and intermediate managerial/administrative/professional C1. – Supervisory clerical junior managerial/administrative/professional C2. – Skilled manual workers D. – Semi-skilled and unskilled manual workers E. – On state benefit unemployed, lowest grade workers (Source: 2001 Census Report, as found in Focus) 1.8 As previously mentioned, the district population also has an above average level of car ownership, with a high proportion of 2 car households. Household tenure rates are also above average, with 72% of the population owner occupiers in 2001, compared to a national average of 68%. (Promis, 2006). 1.9 The Claimant Count Unemployment Rate shows consistently below average unemployment rates for the Northampton ‘travel to work area’ since 2001. In October 2005 this unemployment rate was 1.9% for Northampton compared to a UK average of 2.4%. Total employment in Northampton has increased at a faster rate than the UK average since 2001, and Promis predicts this above average employment growth to continue in the 2004-2009 period. 1.10 The service sector provides the majority of employment, accounting for 75% of total jobs in the area. The full breakdown of employment by sector is show in the chart below: C:\Documents and Settings\DBlandamer\Local Settings\Temporary Internet Files\OLK1F4\Property Market Review.doc Employment by Sector 2001 (%) 30 25 20 Northampton District % 15 10 UK 5 0 l i g s d d d , y a t n es e n g , n n on i i r t r r c n g ti i a i tr o a es u n r i v i t p s e a e a r Re l r m e uc t i k c s t e tr s n a te n dus ag f Pr o anc S Ca u In or n Ba t H n i ons Tra Indu S F her C t Ma O Employment Sectors (Source: Focus Town Report, 2006) 1.11 Engineering is a key industry in the town despite some rationalisation in recent years. The town has also emerged as a key distribution location due to its central location and proximity to the M1. Key employers in the area are shown in the table below: Company Name Number of Staff Employment Sector Barclaycard* 2500 Banking, Finance and Business St Andrews Hospital 2000 Other Services Royal Mail 1500 Distribution Avon Cosmetics 1200 Distribution Curtis Instruments (UK) Ltd 750 Engineering * Barclaycard is planning several hundred redundancies in the near future as part of a nationwide restructuring programme. This will heavily influence these figures. Property Market Analysis 1.12 In this section of the report we review the property market sectors relevant to Northampton central area as follows: • Retail C:\Documents and Settings\DBlandamer\Local Settings\Temporary Internet Files\OLK1F4\Property Market Review.doc • Hotel and Leisure • Office • Residential • Industrial In doing this we aim to highlight the specific constraints to, and opportunities for, development in the town centre. The Retail Sector 1.13 Northampton currently has an average retail offering for a town of its size and population. 90% of the top 20 high street retailers are present in the town (Focus), and there are 2 department stores (Beatties (House of Fraser) and Debenhams). The quality of the fashion retailers, a key driver of visitor numbers in a town centre, is above the UK average (Promis). The majority of these target the ‘middle’ sector of the market, including all major mainstream retailers (for example Next, Topshop), however the ‘upper-middle’ sector of the market are also well catered for. 1.14 Northampton has a total of 518 retailers covering a total floorspace of 123,000 sq m (1,321,000 sq foot). There are 3 managed shopping centres in the town, The Grosvenor Centre, Peacock Place, and St Peters Way. These centres account for 31% of total retail floorspace, which is average for a UK town centre (GOAD Town Centre Report). 1.15 The Grosvenor Centre is the major centre within the town, and is the ‘prime retail pitch’ in the town. This centre and Abington Street is considered to be the retail core, with on average the highest footfall and the highest rents achieved. Peacock Place has a number of key tenants including Next and Evans, but no anchor tenant. St Peter’s Way is in a secondary area of town, accessed via Gold Street, with predominantly ‘big box’ tenants, focused on value retailing. 1.16 Northampton has a limited offering of speciality and more up-market retailers. Those in the town are predominantly located in St Giles Street, and Beatties department store (in The Grosvenor Centre) has a number of upmarket concessions, for example Jaeger, Coast and Planet. 1.17 Retail warehousing floorspace is estimated at 131,000 sq m (1,414,000 sq ft), the majority of which is found outside the town centre. This is higher than the actual town centre retail floorspace. St James Retail Park and Nene Valley Retail Park on Towcester Road are the major locations for retail warehousing. There is also the Riverside Retail Park which also has a number of high street retailers, such as Next and C:\Documents and Settings\DBlandamer\Local Settings\Temporary Internet Files\OLK1F4\Property Market Review.doc Blacks. The Sixfields area also houses a number of ‘big box’ retailers, although this is currently the smallest of the parks in terms of floorspace. 1.18 Out of town food retailing is also well provided for with an above average provision per household (Promis). There are 2 Tesco stores, Morrisons, J Sainsbury, Waitrose and an Aldi within 5 miles of the town centre. The food store provision within the town centre is below average however, with only a small J Sainsbury store 4,130 sq m (44,425 sq ft, located in The Grosvenor Centre), an Iceland (on St Peter’s Way) and a Marks and Spencer’s ‘Simply Food’ store. This highlights an opportunity for new town centre food retailing. 1.19 The high level of retail warehousing is a major threat to the ‘health’ of Northampton town centre. A recent survey conducted by CB Richard Ellis, ‘Fashioning a Shopping Experience’, shows that the average shopper now has a preference for out of town location due to the availability of free parking and larger shops. A number of major retailers who have traditionally been town centre based, such as Next, Boots and Marks and Spencer, are now developing a trend for opening new, larger units on retail parks. There are also improved shopper facilities provided, such as restaurants and cinemas. Increasingly crowded town centre conditions, (due to a lack of large modern units), are further pushing shoppers to out of town locations. 1.20 A further threat to Northampton town centre is the improvement of ‘competing centres’ in the area, that have the potential to attract local shoppers to those centres rather than shopping in Northampton. The development of the Bull Ring in Birmingham city centre and the proposed expansion of the retail provision in Milton Keynes are attracting increasing number of shoppers from the locality and other surrounding areas. Both these centres can be considered as superior shopping destinations to Northampton, and may encourage ‘leakage’ of the local population from Northampton town centre.
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