Property Investment continues to flood into the Tees Valley according to Jonathan Simpson fellow Director and Co owner of Connect Property North East and is illustrated by a number of high profile deals.
South Street Capital has acquired, on behalf of an overseas client, Park View Industrial Estate, Hartlepool for £3.81M. The estate, which was sold by UK Land and Estates, comprises 165,284 sq.ft in 27 units with a void rate of approximately 12%. The current rental income is £427,000 per annum which reflects an initial yield of 10.5%. The estate provides a high income return with opportunities to increase this further through active management, refurbishment and lettings.
In Darlington, Morton Park Way has been acquired from supermarket chain Morrisons for more than £4m by property fund Rockspring in partnership with industrial asset firm Caisson Investment Management. The estate comprises of over 40 units with potential to achieve full occupancy and become a strong hub for start-up and growth businesses, not only from Darlington, but from the surrounding area. There is real scope for new businesses to establish themselves at Morton Palms Way and to expand, due to the flexibility of the units. Since the acquisition at the back end of 2015, significant investment has been put into the estate, with the immediate effect of reducing the void and increasing rental growth.
Over the course of the last two years perhaps the largest investment in the Tees Valley property sector has come from Gateshead based UK Land Estates. The latest firm to move to the park is manufacturer Cavotec; who have moved to a bespoke 25,000 sq.ft facility. The refurbishment for Cavotec is part of a £6 million investment in the estate – a notable achievement being the previous £1.3 million refurbishment of the former Tabuchi Electronics factory for occupation by local business Cotswold Manufacturing who have created 55 new jobs from the expansion of their business. UK Land have spent more than £6m over the last few years on improving the estate. A further investment of £1.75 million will go in to the provision of 17,000 sqft of refurbished industrial units that will be ready for occupation later this summer and a retail parade development of six shops with Greggs already signed up, and construction already underway.