It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.
It has become something of a tradition, given that we’ve been doing this now for over 30 years.
Here we speak to Paul Morris, development director at St James Securities.
Whilst there are a lot of reasons for doom and gloom at present, I prefer to start a new year on a positive note.
Although 2023 is set to be another challenging year for the economy with the cost of living crisis and record inflation, on the demand side a number of sectors are currently bucking the trend, both locally and nationally.
There continues to be a major housing shortage and this will result in significant growth in the Build to Rent (BTR) sector, which will go from strength to strength in 2023.
St James Securities are currently considering future phases of BTR at our award-winning Becketwell Derby scheme, which will go some way to meeting the demand for high quality rented accommodation in the city centre.
The student accommodation market also remains pretty strong and I believe the demand for purpose-built student accommodation will continue to increase over the next few years as more young people choose to go to University.
The office market is set to see a strong focus on energy efficiency as the drive towards achieving carbon zero continues. By 2030, all non-domestic rented buildings will need to meet EPC Band B, which is a substantial raising of the bar. Buildings moving towards carbon zero will lease well and I hope this will result in an overall improvement in the quality of rented accommodation.
The pandemic has strengthened the demand for flexible office space, and this is set to continue this year and beyond, with hybrid working now part of the fabric of the workplace.
As leases come up for renewal, more and more businesses are likely to reassess their accommodation strategies and consider a move towards flexible office space.
Employers need to make it attractive for employees to come back to the office and they will need to offer a great working environment in order to attract the best calibre of staff.
I believe the hotel sector will remain reasonably resilient. In Derby there is latent demand for an upper mid-scale four-star hotel. We have plans to meet this demand with the introduction of a hotel into a future phase of the Becketwell scheme.
Overall, the general outlook is definitely one of caution. We as developers have been through challenges like this before in the early 1990’s, 2002 and 2007-2010 and are in it for the long haul.
As we all know, business is full of challenges and we just need to work through any setbacks and find different ways to achieve our aims.
