Industrial and logistics take-up hits record high
Take-up of industrial and logistics space in the West Midlands (units of 100,000 sq ft plus) hit record levels in the first half of 2021, reaching 4.22 million sq ft.
This represents a huge 322% uplift on the same period last year and is 96% above the long term average, according to Savills latest Big Shed Briefing.
Savills said that while demand in the region has historically centred around the manufacturing and automotive sectors, this half year has seen a rapid uptick in activity from other types of occupiers.
The year to date has seen 53% of activity come from third party logistics and 26% come from online retailers, with the remainder spread over other sectors.
The strong take-up figures have meant that supply in the West Midlands has decreased 56% to 3.84 million sq ft, equating to just 0.81 years of supply.
Additionally, Savills reports that the current stock available in the market is heavily skewed towards second hand units, many of which are in need of refurbishment, therefore providing opportunities for developers and investors.
The vacancy rate within the West Midlands market now stands at just 4.48%, down from 10.31% only a year ago.
Ranjit Gill, industrial and logistics director at Savills Birmingham, said: “The high levels of take-up, coupled with the variation in occupiers, is a hugely positive indicator for the West Midlands market. The shortage of vacant stock means that we expect to see continued rental growth in the market, with developers and investors taking opportunities to refurbish and redevelop the lower quality stock.”
