Land Sale clears way for Welsh Scheme as European Industrial take-up increases

Posted on 11 June, 2015 by Chris Grigorovsky

A report from DTZ shows that European logistics and industrial take-up increased by 6% in Q1 2015 compared to last year.

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A total of 3.8 million square metres of industrial space was leased in the first quarter of 2015 due to high demand for European logistics and industrial space.

According to the report, retailers and industrial companies are the most active in the three core markets of the UK, Germany and France.

Robert Hall, Head of EMEA Logistics at DTZ said: “Location-wise, Germany remained the most active market in Europe in Q1 2015, with 35% of total occupier activity recorded in the region.

“The CEE region also had a strong start to the year with more than 800,000 square metres of logistics space leased, up by 32% in comparison with the same period a year ago”.

Elsewhere, rental values are stable in the majority of European markets, with an increase in some of the CEE markets, including Budapest and Bucharest.

Industrial rental values are expected to see a substantial increase, with an average of 1.6% a year, over the next five years.

European industrial investment volumes reached €4.2bn in Q1 compared to the year previous year – a record year for the decade. The UK came out as the main European investment hotspot, with the largest transaction of the quarter taking in €1.3bn of inflows.

Head of EMEA Research at DTZ, Magli Marton, said US investors are showing some “strong interest in the European industrial markets”, adding “We expect to see investor activity continuing on the buy-side as a couple of pan- European portfolios are currently on the market.”

Meanwhile Welsh Economy Minister, Edwina Hart (pictured below), says the sale of a 16.61 acre site for the development of light industrial units in Pontypool could create 100 new jobs.

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The Usk Vale site has been purchased from the Welsh Government by family owned property company Formaction Limited, represented by Middleton Perry, which specialises in the acquisition and development of industrial assets across South Wales.

DTZ was appointed by the Welsh Government earlier this year to secure a buyer who would redevelop the site for employment purposes.

Agreeing the sale Mrs Hart said the development would provide much needed industrial space for small businesses and would have a positive impact on the local economy.

Chris Yates, of DTZ’s Industrial agency team in Cardiff said the site has attracted interest from a variety of potential buyers and they are delighted with the sale to a developer who is focussed on delivering the scheme.

“The purchaser recognised the acute shortage of new build stock currently being undertaken in South Wales and saw the site as a key for the South Wales industrial market which continues to show signs of improvement,” he continued.

James Perry, of Middleton Perry, added: “Formaction are preparing for the first phase of development which will comprise two terraces of light industrial units, each approximately 20,000 sw ft, which will be available either as a whole or as individual units from 2,000 sq ft upwards. They hope to make a start on site by September of this year.”




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