Is demand for Residential Development sites on the increase?
Wed 07 Feb 2024
During the last quarter of 2023, Residential Development land, on a national basis, fell in value. Fewer sites were sold as there were fewer developers in the market to bid on them; the reason for this was generally a lack of supply, driven by a rise in build costs, making developments less profitable.
Some locations are now bucking that trend, such as in north Norfolk where there is a shortage of sites and land values remain resilient.
For example, we are currently in the process of selling the former Fakenham Academy which comprises a listed building extending to approximately 3,400 sqms (37,000 sqft) on a site extending to in the region of 2.5 hectares (6.17 acres) of land.
To the front is a large grassed area which will be handed to the local parish for the use of the local school.
To the rear are a number of former school blocks together with a swimming pool which are likely to be demolished and redeveloped.
On behalf of the county council, myself and my colleagues in Holt have been marketing the site for the last couple of months.
Demand has been strong enough that on Monday we received offers to sell the property by way of formal tender and we are currently working with the county council and deciding which offer to accept.
Particularly in Norwich, apartment schemes have seen less demand than general housing sites on greenfield land, again due to the higher build costs to deliver these opportunities.
However, we are still under the clutches of Nutrient Neutrality which has resulted in very few housing schemes being granted planning permission for in the region of two years because of the increased amount of phosphates that are released into the water system.
I actually have four sites in Norwich that are affected by Nutrient Neutrality however it does seem that a solution is on the horizon, meaning these should be able to be released over the course of the next year.
In conclusion, there is a smaller number of developers buying sites however because of Nutrient Neutrality there are fewer sites on the market, such that when sites do become available, bidding remains competitive.
For more information, please contact Andrew Haigh, Commercial Surveyor, Norwich on 01603 629871.
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