Big Shed Briefing – January 2018

Supply and vacancy steady as take-up recedes to long-term average levels


■ There has been 24.46m sq ft of warehouse space over 100,000 sq ft transacted in 2017, which is 2% higher than the long term average.

■ The principal driver behind the fall in take-up has been a sharp decline in the amount of build to suit deals from 18.50m sq ft in 2016 to 11.49m sq ft in 2017.

■ This can be attributed to the fact the businesses are taking longer to commit to capital intensive projects, potentially driven by the current uncertainty around our future trading relations with the EU.

■ The supply of warehousing in the UK currently stands at 28.63m sq ft, giving a vacancy rate of 6%. We are tracking 4.4m sq ft of space through the development pipeline which will be added to our supply statistics in 2018.

■ The sector remains attractive to investors from across the globe. £3.7bn has been invested in logistics warehouses in 2017 making it the second strongest year on record with overseas investors accounting for a quarter of purchasers. The wider industrial sector accounted for 17% of all investment in commercial property, a record high.

Main image: Altitude Milton Keynes where a unit of 574,000 sq ft is being developed by Gazeley and due to complete in the first quarter of 2018

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