In association with the UK Warehousing Association (UKWA), a report by Savills has showed that the current total volume of existing warehouse space in the UK is 424 million sq ft, with a nationwide vacancy rate of 7.5%.
It also looks into warehousing stock in the UK and highlights the critical lack of supply and development in the market for the first time ever.
The report, titled ‘The size and make up of the UK Warehousing Sector’, also found that the East Midlands has the highest amount of space, accounting for 18%. It goes on to say that occupiers from the various sectors in different locations, need diversity in unit sizes.
The retail sector sector is the focal point of the report, showing its importance by explaining that it accounts for 35% of all stock. It found that nearly 80% of food retailer’s warehousing was identified as larger than 250,000 sq ft, while two-thirds of parcel operator units were smaller.
According to the research, supply is at 32 million sq ft, 6.5 million sq ft of which is classified as Grade C stock and not fit for purpose. It mentions that take-up for build-to-suit units is at 51%, adding to the increase of scarcity of land in the prime industrial locations.
Commenting on the findings, head of industrial research at Savills, Kevin Mofid, said: “The availability of modern and fit for purpose warehouse space has the potential to be a real pinch point for the logistics sector in the coming years.”
“Whilst this initial white paper doesn’t quantify the amount of allocated land in the pipeline, many schemes that we are tracking are not necessarily deliverable in the short term.”
“This paper provides a useful tool for the property and logistics industry to help frame the debate on the importance of logistics real estate to the logistics industry, and the vitality of the UK economy moving forward.”
While Peter Ward, UKWA CEO, adds: “This report reveals the true scope of the property challenge facing the logistics sector and UK plc.
“We call on policy makers, both nationally and locally, to acknowledge the importance of the logistics industry and to deliver policy which allows for the growth of the space required for our industry to continue delivering.”
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