Regional industrial and logistics take-up levels soar

Industrial and logistics take-up in the UK for 2018 reached record levels, with Yorkshire and the North East performing second highest in the country at  6.731m sq ft transacted.

According to the latest figures from CBRE, the Yorkshire & the North East had a phenomenal year with take-up at 6.731M sq ft compared to 1.26m sq. ft. and 2.45m sq ft in 2017 and 2016 respectively. Regionally, take-up levels were dominated by the East Midlands at 11.762m sq ft, representing 37.35% of the UK’s overall take-up.

Total take-up in 2018 for big box logistics – min of 100,000 sq ft and 10m plus eaves 0 reached 31.495m sq ft, surpassing both 2017 and 2016 levels at 17.4M sq ft and 29.3m sq ft.

Take-up in the South East remained consistent, at 5.8m sq. ft. representing 18.42% of the national take-up.

Take-up by occupiers in the e-commerce sector continued to grow, reaching 9,98m sq ft in 2018, which is the highest on record, accounting for approximately 32% of all take-up nationally.  Combined with food retail and ‘other’ retail the B2C segment overall accounted for 52% of all warehouse take-up.

There is currently 28.13m sq ft of lettable space.  Around 29% of that availability are buildings presently under construction in 36 projects.

There are currently 67 buildings under construction with an aggregate floor area of 22.905m sq ft.  Of these, 28 (14.13M sq ft) are committed design and build schemes with the remaining 39 (8.771M sq ft) being speculative.

Jonathan Compton, Head of Industrial & Logistics Strategy at CBRE UK said: “2018 saw an increase of lettings of the XXL warehouses, which has given developers confidence to build speculative warehouses on a very large scale. Moreover, as the e-commerce sector continues to develop, we expect appetite for warehouse space, especially in urban ‘last-mile’ areas to remain strong.  However, there remains a demand/supply imbalance that in normal market conditions would indicate continued and tangible rental growth going forward.”

Mike Baugh, Senior Director, CBRE Leeds Industrial team said:

“The regional performance in 2018 in Yorkshire and the NE has been incredible and proof that it is up there with the best locations in the UK for distribution.  The region now has a proven track record for offering excellent demographics, communications network and large scale land availability, all of which have been factors in attracting occupiers from all sectors of the industrial and logistics market.”