DTZ: Industrial demand remains strong in North West
Tenant interest remains resilient in industrial space within the region despite occupier demand falling over 50% between the fourth quarter of 2010 and first quarter of 2011, according to DTZ.
Within DTZ research's property times UK industrial report, which covers the market for properties over 50,000 sq ft, it said just under 1m sq ft of deals were completed during the first three months of the year compared to 2.5m sq ft let during the fourth quarter of 2010.
However, DTZ said the figure for the first quarter is "is firmly in line with the seasonal Q1 average" and activity continues to be dominated by retailers seeking national distribution hubs.
Tony O'Keefe, director of DTZ's industrial and logistics team in Manchester, said: "Patterns of activity in the North West followed on from the previous quarter as a mix of opportunism and expansion drove occupier decisions. A gradual erosion of the best quality space is bringing forward the tipping point where occupiers will face an undersupply of quality accommodation leading to potential rental growth. This is further highlighted by a growing appetite for land from both occupiers and developers, despite a dearth of suitable sites."
DTZ's research said letting activity in UK industrial market increased 800,000 sq ft to 6.9m sq ft in the first quarter of 2011.
However, despite the increase in activity, overall take-up was down from the 7.3m sq ft seen in the first quarter of 2010. The report revealed that retailers and manufacturers dominated the take-up of industrial space during the quarter, accounting for over 90% of all activity.