Handsome, historic, and with a city centre you can walk across in 15 minutes, Exeter faces a shortage of development land that is typical for cities of its type. The only offices being built in the centre this year are behind the late Georgian Southernhay, where 33,000 sq ft has been completed and let at Senate Court by Rokscar, a joint venture between Rokeagle and Scarborough Developments.
The developer is now pressing ahead with a larger 72,000 sq ft building, the Senate.
One of the conference rooms at King Sturge’s Exeter office overlooks the Senate site, and the firm is one of the agents for the development. The general feeling among King Sturge staff is that the city needs to foster more development rather than less. They are keener to talk about Plymouth, largely on the grounds that the more westerly city has ambitious plans for a massive redevelopment in its port area (see Plymouth, p78).
For the time being, occupiers looking for space in Exeter are likely to look towards Exeter Airport and Exeter Business Park.
Not everybody is troubled by the situation. Nick Hole, managing director of Rokeagle, is pleased with the way the city has developed in recent years and seems reasonably optimistic about the future. “It’s not too bad just at the moment, but the lack of sites could become a problem shortly,” he says. “This is positive, because it indicates that there has been a lot of development in the past four years.”
Hole believes you only have to look at Exeter’s restaurants, which now include one overseen by Michelin two-starred chef Michael Caines, to gauge how the city has developed.
“There is truly a vibrant restaurant scene now, and it indicates how the city has come on,” says Hole. “Exeter went through a long period when it failed to unlock its potential, but I don’t think you can say that any more.”
Exeter’s hotels have also been doing well, says Philip Johnston, head of Savills’ hotels division, which last year handled the sale of two of the city’s major hotels, the Royal Clarence and Buckerell Lodge. He says the city’s general economic strength has been visible in the hotel market, with increased occupancy and room rates.
Most commentators agree that what Exeter needs now to keep up the momentum of the past five years is another groundbreaking deal, such as the one which brought the Met Office to the city last year. The office, in the 100-acre Exeter Business Park, is one of just two such weather centres in the world, the other being in Colorado, US.
“It cannot be overstated how important this has been,” says Hole “The deal brought a new confidence to the city.”
The business park – a Rokeagle development – is now 90% occupied – and Hole is confident the remaining 10 acres will soon be filled. Construction is about to start on another 24,000 sq ft three-storey building.
Hole’s confidence is shared by some of the city’s agents. Ralph Collison, partner at Alder King’s Exeter office, says: “There has been an accelerated level of demand over the past three to four years, particularly helped by the Met Office, which took 400,000 sq ft.
“An analysis of the take-up figures shows that, for example, the 10-year average take-up for new-build offices is around 60,000-80,000 sq ft pa. This rose to 170,000-180,000 sq ft pa in 2003-2004, excluding the Met Office. And all this took place against a background of a steady build up of existing space.”
Collison points out that, in addition to further development at Exeter Business Park, there is a proposal for a 25,600 sq ft three-storey office at Woodwater Park. The mixed-use Matford Park also continues to expand.
“An ongoing programme of industrial, warehouse and office development makes this 58-acre development a key provider of commercial opportunities within the city,” he says. “There is also an office extension to the development, which could provide 15-20 acres of adjacent development land.”
Exeter council’s director of economy and development John Rigby broadly agrees with Collison’s analysis. “Confidence in the Exeter market has grown considerably since the Met Office’s decision to locate its headquarters here,” he says. “Despite the increase in demand for sites, we are still able to steer investors to a choice of sites in the city.”
Planned science park
That choice of sites and therefore the future of Exeter’s expansion lies mainly to the east of the city, with the most notable being the proposed Skypark, which offers around 100 acres close to Exeter Airport, and a planned science park at Redhayes, at junction 29 of the M5.
Philip Kerr, partner at Taunton-based Kenningtons, says: “There is a lot of land available potentially but, as things stand, there is only a little bit left, and that is in Exeter Business Park. If you are looking for a big distribution depot or a brand-new office building at the moment, you are going to struggle to get it.”
Kerr argues that this is one reason why towns around Exeter stand to benefit from rising demand for better premises. Firms seeking offices could decide to look elsewhere.
The staff of those companies which do decide to remain in Exeter should see a marked improvement in the city’s shops over the next two years. One of the main shopping areas, Princesshay, is closed off as Land Securities continues its £200m reworking of the block to provide a new mix of shops, flats, bars, restaurants and public spaces.
The scheme’s flagship store, Debenhams, is relocating from its store nearby. It will be joined by, among others, Next, Virgin Megastore, Topshop/Topman, La Senza, Costa Coffee and Holland & Barratt, all of which have recently signed up for space
John Grimes, retail leasing director at LandSec, has high hopes for the Princesshay development, and describes Exeter as “forgotten gem”. He adds: “Exeter has a lot more potential in terms of its catchment area in the South West than Canterbury, where we have just finished. A lot of people should come to shop here from outside the city.”
The new Princesshay, totalling 530,000 sq ft, should be completed by October 2007. Along with shops and facilities, it will expand public space in the city centre by 16,000 sq ft, and create additional views of the city’s cathedral. LandSec has also promised to make parts of the old city wall and medieval almshouses more visible and accessible.
The 130 flats in the development will add substantially to city-centre residential provision, which is minimal (see Residential, p86).Residential developers in general remain keen to snap up what land in the area that they can. Schemes such as the recently launched latest phase of Persimmon’s Kings Heath development ensure that a steady flow of houses and flats comes on to the market.
There could be worries about the amount of development land available, but Exeter’s underlying economic health leaves little doubt that residential developers will sell their houses.
