Quiet start to the year for North West logistics sector, new figures reveal
North West logistics markets saw a halving of transactions in the first three months of 2025, compared with a busy final quarter for 2024.
The total take-up for Q1 was just 555,000 sq ft of industrial space.
But according to research by Knight Frank, the overall annual figure (units +50,000 sq ft) is still 14% higher than the previous 12 months and approximately 980,000 sq ft is currently under offer.
Partner, Rob Tilley, said: “An active end to the year for take-up has been followed by a quieter than expected first quarter. However, there are a number of active requirements in the market which should bolster the H1 statistics.”
He added: “Some of the delay with transactions has been due to protracted decision making processes caused by general economic uncertainty.
“A lack of good quality units in prime locations is still pushing headline rents upward. While increased availability in the second hand market is allowing for more choice with some landlords being forced to offer increased incentives.”
The biggest deal so far saw Finsa UK commit to a new design and build facility at Birkenhead Docks.
The 159,904 sq ft unit, being developed by Glencar will be the company’s UK headquarters.
Other notable deals included the 103,000 sq ft Icon 4 at Manchester Airport let to event production and equipment hire company, Sterling Event Group.
It agreed an 11-year deal at £10.50 psf.
While Unit 6 at Westpoint Enterprise Park, Trafford Park went to locomotives specialist, LUR, on a 10-year lease, also at £10.50 psf.
Looking at supply there is currently 5.6 million sq ft of stock available (units 50,000 sq ft +) with 10 more units totalling 2.2 million sq ft currently under construction with speculative end use – 40% down on last year.
Prime rents are stable at £11.50 psf, but are expected to grow by 4.5% this year across the region with Manchester tipped to see 5.6% growth, according to RealFor.
It’s been a busy quarter for investment activity with £285m pumped into the region as investors look to put their money into prime assets.
Network Space’s sale of Broadheath industrial estate in Altrincham to M7 for £47.4m reflected 5.04% Net Initial Yield (NIY) while Tritax Big Box REIT’s acquisition of a Sainsbury’s 626,000 sq ft distribution unit at Haydock for £74.25m reflected 6.00% NIY.
Logistics and industrial and capital markets partner, Matt Stretton, said: “The strong levels of investment activity in the final quarter of 2024 have continued into the first quarter of 2025, albeit volumes are down on the same period last year.
“While transaction volumes are down, we are witnessing a good depth of investor demand, particularly for well located assets.
“We continue to see strong demand from overseas investors, whilst institutional capital has so far been under-represented compared with previous years. However we expect this to shift as the year progresses.”
