Hilsea Industrial Estate land sells for record £9m as prices per acre boom post pandemic

Property consultancy Vail Williams sold the land at Hilsea Industrial Estate for £9m, on behalf of a private owner.

The 4.5 acre plot was bought by a commercial property developer.

Prices for land per acre have nearly doubled since pre-pandemic levels, rising from between £750,000 and £950,000 to £2m.

Russell Mogridge, partner at Veil Williams, said: ‘The value of industrial land, particularly where there is opportunity to build more units on the same footprint and increase annual rental income, continues to rise to record levels here in the Solent region.

‘Industrial estate values are being driven upwards here by a shortage of industrial property, such as warehousing, to support “doorstep” supply chain logistics driven by thriving e-commerce sales across the UK and abroad.

‘In some cases, industrial land is eclipsing the value of residential housing development sites – it is very much a seller’s market and there may be some way to go yet before the top of this particular market is called.’

Hilsea Industrial Estate dates back to the 1960s, and has occupiers including Lidl, Dulux and the Range.

The 4.5 acres have been purchased by Fiera Real Estate and Wrenbridge.

Plans are in place to develop a multi-unit Grade A industrial scheme, with an estimated gross development value (GDV) of £33m.

GDV is the predicted revenue from the scheme when its finished.

Lets will be available for occupation, marketed by Vail Williams and CBRE, in 2023.

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Mr Mogridge added that buying industrial land will see good returns long term, as he predicts a 10 per cent increase in rent over the next year.

He said considering the rise in demand for high quality workspace, and high number of job vacancies causing more bosses to consider how good their premises looks to secure skilled staff, he advised his client to sell.

Mr Mogridge added: ‘All of these reasons, along with Brexit and the post-pandemic business bounce back, have created the conditions for a boom in demand for industrial land and buildings.

‘It is because of this incredible confluence of macro-economic conditions that we advised the owner to sell the asset.’