Industrial take-up in NW soars as vacancy rates hit record low
Industrial and logistics take-up in the North West reached 2.64 million sq ft in the first half of 2020 – for units of 100,000 sq ft+ – according to the latest Savills Big Shed Briefing.
This makes it the second best firs thalf ever recorded.
In spite of the economic uncertainties caused by COVID-19, take-up levels rose 128% above the first half of 2019, and 56% above the long-term first half average, pushing the vacancy rate down to a record low of 5.48%.
Approximately 30% of space transacted was for short-term deals of less than a year, as a result of COVID-19.
However, Savills also notes that there has been significant expansion from a number of operators during the period, with DSG taking 375,000 sq ft, Kelloggs committing to 525,000 sq ft, Hermes taking 290,000 sq ft in two units, and notable supply chain enhancements from AO.com and Amazon.
Savills goes on to note that, due to the strong take-up levels, supply of warehouse space in the North West has decreased substantially in the past 12 months, falling from a peak of 7.26 million sq ft to 4.24 million sq ft.
Using the five year take-up average, this equates to just 1.07 years of supply in the region.
Jonathan Atherton, industrial and logistics director at Savills Manchester, said: “The North West has seen a huge uptick in enquiries and subsequent transactional activity, with the market responding to the requirements brought about by COVID-19.
“We are continuing to track a significant volume of deals due to complete in the second half of the year, suggesting that the resilience of the market is set to continue, which, given the wider global situation, is hugely positive for the North West region.”