Market Insight

Crawley property market and COVID-19 – 5 reasons to be optimistic in 2021

February 3, 2021

Whilst COVID-19 has had an impact on the economy in and around the Gatwick region, there are still some positives to take into the rest of 2021, as Tom Neal explores.

Reports that Crawley would be one of the worst-hit town economies in the UK found their way into the headlines during 2020, fuelled by the town’s reliance on the aviation sector and the impact of COVID-19 on Gatwick Airport.

Indeed, a report from Centre for Cities showed that Crawley experienced a 5.1 per cent increase in unemployment after the first lockdown, the third highest in the UK.

As Councillor Peter Lamb, Leader of Crawley Borough Council, remarked earlier in the year: “The lockdown has hit our economy harder than any other part of the UK, but all local businesses and public sector organisations are committed to getting things back on track.”

Whilst Crawley has been disproportionately affected by the pandemic, there is more to the story. In fact, many parts of the local property market have remained strong.

Our Gatwick team explores current market trends across the region, as well as some of the regeneration projects underway in Crawley and the surrounding area, which should give both commercial occupiers and potential investors reason to feel optimistic in 2021.

1. A committed Council
Throughout the pandemic, Crawley Borough Council has continued to lobby Government for more support, including action on Gatwick airport jobs.

They were also quick to respond to the impact of the pandemic, creating the Crawley Economic Recovery Task Force (CERT) and Town Deal Board, to evaluate the impact of the crisis on the local economy, and drive the development of a recovery plan for the town.

As a local business based in Gatwick, we were pleased to contribute our views, both as a company and as local property experts to inform Crawley’s recovery strategy, and to ensure the town is well placed to bounce back from COVID-19.

2. Counter-recessionary recovery programme
Core to Crawley’s recovery is the town’s £1bn counter-recessionary recovery programme which continues to plough forwards, delivering a new residential neighbourhood in the town centre with significant investment in state-of-the-art new commercial space at Manor Royal.

The Manor Royal Business District, as indicated in the Manor Royal Recovery Plan, has continued to develop throughout COVID-19, investing in the delivery of better transport infrastructure, continued maintenance and a pipeline of new facilities.

The result of this can be seen in continued developer interest in the site, with several recent land sales commanding record values despite the impact of COVID-19.

3. An attractive home for business
Whilst COVID-19 has been a challenge for the office market across the country, Crawley continues to prove an attractive location for businesses.

Our agency team on the ground there continues to receive enquiries both from applicants new to the local market, as well as existing occupiers prompted by lease events to move.

In recent months, we have seen recruitment specialists, Barrington James, take 10,500 sq ft of high specification grade A office space in the Galleria building in the town centre, and at Manor Royal, Permanese have just doubled their occupancy by acquiring a further 12,000 sq ft of office space.

Our team has also been involved in a 12,700 sq ft letting of Grade A offices at One Forest Gate, achieving one of the highest rents in the town.

4. A hotbed of industrial demand and land supply
In line with the national boom for warehouse and logistics space, the Crawley market is performing well and catering to a range of e-commerce and delivery businesses. One example is Amazon which has recently taken 40,000 sq ft of warehousing at North Gatwick Gateway alongside significantly larger pre-let accommodation elsewhere in Crawley.

Meanwhile we have just completed the letting of 20,000 sq ft of refurbished warehousing at Gatwick Gate Industrial Estate to another online retailer.

With land in such short supply at Manor Royal, the appetite from developers and investors for commercial development sites continues unabated. Land sales have included 3.8 acres at Churchill Court which was purchased by Equation / Arrow Capital, a 10-acre former Virgin training facility, The Base, which was acquired by Marchmont Investment Management and 7.7 acres currently under offer at Napier Way (November).

These will deliver much-needed new industrial stock in 2021, and with the rumour that over £3m per acre has been achieved, it is clear to see the impact that demand is having on land values here.

What each of these transactions and business commitments demonstrates, is the continued strength of Crawley as a commercial location, even at a time of global economic uncertainty.

When you add to this the town’s skilled workforce, its excellent motorway connections, mainline rail services into London, as well as the proximity of Gatwick Airport, the recipe for Crawley’s long term economic strength seems to be baked in.

5. Leadership by example
Crawley Borough Council continues to lead by example and work on its Local Plan, together with recent national planning changes aimed at encouraging more development, provide reasons for optimism in 2021.

Regeneration of the town centre continues apace, with Westrock’s development of the new nine-storey Town Hall and home for the borough council forging ahead, including delivery of 78,000 sq ft of Grade A commercial office space spread over five floors.

Meanwhile, a £27m package of investment in gigabit-speed full fibre broadband continues, which will benefit the town centre, Manor Royal Business District and surrounding neighbourhoods. There are also hopes to access up to £25m in government funding to drive town centre regeneration and invest in Manor Royal.

Crawley has been a key commercial hub for decades and this will continue to be the case for the foreseeable future. It is a town which has masterminded its own recovery to ensure a post-recession bounce back, rather than standing on its laurels.

Thanks to the proactive stance taken by Crawley Borough Council and other regional stakeholders including Gatwick Airport, Manor Royal BID, West Sussex County Council and Metrobus, Crawley is well-placed to deliver sustainable growth. So, despite justifiable concern at the start of the pandemic, there are reasons to be optimistic.

As a business that has been based in Crawley for many years, we are confident about its future, both as a place to work and as a robust location for businesses and investors to continue to invest in.