Increasingly, office occupiers are attracted by the presence of retail or some form of leisure experience, while shopping centres should benefit from close proximity to office populations and leisure facilities, such as cinemas, bars and restaurants.

Millennials expect to be able to shop, work and socialise when they like, and not necessarily make unique journeys for each. In order to attract young talent, office occupiers’ location strategies are increasingly focused on where that talent wants to live, and so we see office and residential quarters encroaching on each other, with the common ground being leisure or retail. Buildings or estates that successfully combine a number of different use types are likely to enjoy higher footfall, longer dwell times, and ultimately become more productive. An example of a mixed-use asset within the Henderson UK Property PAIF can be found in Bermondsey, South London, and includes office, retail, residential, restaurant and cinema elements.

Bermondsey, South London

The world is becoming more information centric. Society’s reliance on creating and consuming data continues to grow, as does the need for data to be available when and where it is needed. To sustain business activity, enhance IT service delivery, and enable new applications, data requirements will continue to grow and require more processing, network, bandwidth and data storage capacity.

Nowadays, organisations of all sizes are faced with having to do more with less, including maximising IT resources against footprint constraints. Beyond simply finding space to store data, organisations need to keep digital information safe, private and secure, in order to protect intellectual property rights. In the second quarter of 2015 the Henderson UK Property PAIF acquired a data centre in Romford, Essex, which is an excellent location with strong demand due to its proximity to Central London. The PAIF also owns a data centre development in London Docklands, which will offer 140,000 square feet of space and is due to be finalised later this year.

It’s cool to love a bargain these days. Shoppers’ perceptions and behaviour have changed and outlets have become trendy, with the retail sector evolving from factory outlets selling surplus stock to designer outlets with high-end concepts. The sector is in a strong state, with rising rents, low vacancy rates and buoyant occupier demand for well-located assets.

Retail outlets typically have lower operating costs, making them more profitable than traditional retail locations, and their value offer has proven resilient to economic fluctuations and the onslaught of the internet. In the bad times, people value discounts and in the good times, luxury thrives.

Dalton Park, Murton, County Durham

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Dalton Park, a retail factory outlet mall in Murton, County Durham, is owned by the PAIF. It comprises approximately 160,000 square feet of retail property space with around 60 tenants including M&S, Next and Gap. During the third quarter of 2016 a leisure development scheme was also completed on behalf of the PAIF at the site. It includes a seven screen cinema and complementary food and beverage offerings, which should also increase footfall and turnover for existing tenants. The scheme is fully let to Cineworld, Prezzo, Pizza Express, Frankie & Benny’s, KFC and McDonald’s.

The transition from manual to autonomous driving may have significant knock-on effects for cities, towns and general infrastructure. Landlords will need to keep an eye on any potential requirements for driverless car park requirements, such as drop-off zones.

We are also seeing increased demand for electric car-friendly parking, with additional charging points installed at the PAIF’s office holdings in Rickmansworth and Cambridge.

Capital Park, Cambridge

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This will continue to be a significant trend to watch as more landlords and tenants explore how they can benchmark and improve health and well-being factors such as natural light, air quality and active design. Various methodologies are likely to emerge and more information will develop, demonstrating the link between health and well-being in buildings and productivity.

Tenants are increasingly taking account of health and well-being factors when seeking new space and as such this is a key consideration for property investors such as us. We always strive to develop close relationships with our tenants to better understand their requirements.

Our nine-strong investment team at TH Real Estate*, which manages the Henderson UK Property PAIF through a sub-investment management agreement, has to be forward looking by nature. Understanding the trends with the potential to fundamentally change our lives and our landscapes is key and sustainability issues are taken extremely seriously from a social and economic point of view.