With Black Friday set to cause a frenzy amongst shoppers and companies alike, a logistics expert at Colliers has said that the event will highlight a new need for super-sized warehouses.
Head of EMEA (Europe, Middle East and Africa) industrial and logistics at Colliers International, Bristol-based Tim Davies, said that retail websites crashing under the strain of consumer demand is the standard association, however it will add another dimension and show challenges that logistics chains face under the pressure of ecommerce trend.
He added: “The way in which people shop has changed fundamentally in the past year, and this is having a significant effect on warehouse property.”
Mr. Davies continues to say that this logistical demand from Black Friday become all the more significant in context with a new report from Colliers entitled ‘European Retail & Logistics Insights: From Sheds to Shelves’.
It shows how traditional warehouses are seeing a reinvention to cater more towards tech-based distribution centres and how industrial property has outperformed all other types of commercial real estate, which is a result of space demand from firms such as Amazon.
He continues to say that retailers who are conducting much of their business online, there is much less need for stock to be maintained within their shops.
“On the basis that warehouse rents are so much less than retail it is hardly surprising that retailers are now ‘selling from sheds’. Inevitable this sector has been one of the best performing asset classes in the UK and Europe over the last two years.”
The report makes a prediction that from 2015-2019 in the UK, industrial property will outperform all other forms of commercial property, on top of beating bonds and gilts.
It was also reported that millions of square feet of e-retail warehousing space will be needed if e-retailing sales reached the predicted 20 per cent of all retail sales.
Combining this with competition for land around key European urban centres and same-day delivery support, ‘Skyscraper sheds’ will see an emergence and scatter across several storeys, similar to what already exists in Hong Kong, Singapore and Japan. These distribution centres would then be orbited by smaller urban logistics bases, so consumer deliveries could then be deployed.
