Marcus Emadi | Director at Turning Point Capital
CONTENTS
Business Parks Must Evolve to Stay Competitive in a City-Centric Era
The future of business parks has emerged as an intriguing post-pandemic theme, with the prevailing narrative being that occupiers are shifting from out-of-town locations to central business districts (CBDs) with stronger amenities and public transport credentials.
While suburban take-up has declined year-on-year since 2022, it was interesting to see business parks playing a significant role in Q1 2025. The South East saw its most active quarter since Q4 2022, with total take-up reaching 1.1 million sq ft, 55% of which was out of town. In the ‘Big Five’ regional markets, out-of-town activity was less pronounced, with city centre take-up reaching 832,500 sq ft, 60% of the total. Overall, out-of-town take-up accounted for 47% during Q1, which shows the continued relevance of business parks to the regional office market, but only where they meet changing occupier demand.
Notable Transactions in Q1 2025
Two of the five largest transactions in Q1 were out-of-town deals, with Cushman & Wakefield acting as agents on both projects. The largest deal saw a confidential occupier acquire 155,524 sq ft across two buildings at Green Park, Reading. The second deal involved EDF Energy taking 78,284 sq ft at 1000 Aztec West, the South West’s first Net Zero Carbon out-of-town workspace.
These transactions highlight that out-of-town markets are holding their own where they offer an amenity-rich environment, strong transport links, and environmental credentials. Such offerings can often be delivered on more competitive terms than CBDs. To achieve this, however, business parks require a holistic approach and consistent management strategy—something many business parks lack due to fragmented ownership. The ability for a single landlord to manage their development pipeline and offer occupiers flexibility to contract or expand across different assets will separate the best from the rest.
The Capital Markets Perspective
From a capital markets standpoint, out-of-town locations commanding lower rents may require longer lease commitments from occupiers to drive viability for refurbishment. The resulting long-term income product could appeal to investors with a more defensive or income-focused strategy, particularly where parks are well-managed and offer a good amenity package.
As the market continues to evolve, it will be crucial for business parks to adapt to meet changing occupier expectations, ensuring their continued role in the broader regional office market.
