The announcement late last year that Prestwick Airport had signed an agreement with Texas USA’s Houston Spaceport in its bid to become the UK’s first equivalent came as a surprise to many in the Ayrshire town and further afield.
What seemed then, to some, pie in the sky, is now a real prospect.
The possibility of the spaceport’s development has struck a note of major optimism for what has been a challenging market for commercial and industrial property in Ayrshire. In the event of Prestwick – which is already emerging as a popular destination for the licensing and leisure industries – succeeding in its bid, it is highly likely that demand for industrial and commercial properties will far outstrip supply.
Notes of cautious optimism in Ayrshire commercial property market aren’t reliant, however, on the vicissitudes of a spaceport tendering process. At DM Hall, we have seen, of late, better uptake in most towns including Ayr, Kilmarnock and Irvine.
As a result we have decided on an increased commitment and presence with more staff to handle demand in Ayrshire in our belief that the extra capacity will be needed when the impact of the recent revaluation of business rates takes effect.
While the licensing and leisure sectors have experienced an increase in business rates, the retail sector – where smaller businesses are under constant pressure from larger conglomerates and supermarkets – has, in the main, received a much needed reduction in rateable values.
Landlords have been struggling to rent commercial properties to smaller businesses prior to revaluation, often having to offer ‘soft’ deals, and failing to maximise value from renters who are struggling with punitive business rates. The recent rates revaluation should see an increase in demand from landlords coming back to rents and occupier demand better than they have been seen for years.
This, coupled with the raising of the threshold from the parsimonious £10,000 to a more realistic £15,000, should tempt smaller businesses into investment in commercial property in town centres and high streets across Ayrshire; particularly in areas which are being regenerated, such as the northern end of Ayr High Street.
The master-plan for the High Street was given the green light in February, and demolition has already started on the land between the ‘Auld Brig’ and the Victorian ‘New Bridge’, and proposals are in place for a mix of student accommodation, office space, and waterfront opportunities for mixed retail and licensing/leisure space.
Heading up the coast to Irvine, regeneration has seen a transformative effect, with over £10 million invested in local construction and development and 1,283 jobs created by the Irvine Bay Urban Regeneration Project, universally regarded as a success.
The effect on the wider property market has been sustained and measurable and is, at least in part, instrumental in our firm’s upgraded presence in Ayr.
On the industrial side of the market as well, there is cause for hope. We have seen a sustained upturn in properties which have been lying empty and in some cases derelict, being refurbished, or demolished and repurposed to new uses.
Of course, the hospitality sector remains buoyant, propelled by our outstanding natural attributes, namely, the springtime Ayrshire countryside and our high quality accommodation, continuing to be popular as holiday, wedding or events venues.
Overall, the commercial property market has suffered through a period of significant challenge in recent years, but every sign we are seeing indicates recovery and improvement in conditions.
Anthony Zdanowicz is a chartered surveyor at DM Hall’s Hamilton and Ayr offices .