The North West now has 1.5m sq ft of speculative warehouses under construction, the largest pipeline in the UK behind the East Midlands, according to research from Colliers.
Colliers identified seven speculative large-scale units under construction in the region, although only one of these has a confirmed pre-let. With an average plot size of 214,000 sq ft and totalling around 1.5m sq ft, these are:
- M6 Major, Haydock: 523,500 sq ft
- Crewe Commercial Park: 237,000 sq ft
- Grand Central, Trafford Park: 185,000 sq ft
- Unit 4, Mountpark Omega, Warrington: 184,000 sq ft
- Unit 1 Pioneer Court, Blackburn: 135,000 sq ft
- Haydock Green: 125,000 sq ft
- Liberty Park, Widnes: 107,000 sq ft
M6 Major is due to welcome Amazon as one of its main occupiers; Bericote is the developer for the site, which has reserved matters planning permission for two units totalling 900,000 sq ft, and outline consent for 1.4m sq ft in total.
While there is understood to be strong interest in many of the other units, no concrete deals have come forward yet, with a number of occupiers with large-scale requirements taking a “wait-and-see” approach due to the UK’s ongoing political uncertainty, according to John Sullivan, director of industrial & logistics at Colliers’s Manchester office.
However, Sullivan expects a number of major deals to complete in the second half of the year, with take-up in secondary stock also increasing the pressure on speculative developments to be delivered.
In terms of rents, Warrington now commands the highest in the region. Here, rents have risen by from £5.50/sq ft to £6.50/sq ft in the past six months. Major deals that have pushed rents up include Royal Mail taking 346,000 sq ft at a rent of £6.25/sq ft, as revealed by Place last July.
In Manchester, rents rose from £5.50/sq ft to £6.25/sq ft, while rents also increased to £5.50 in Liverpool and Lancashire, up from £4.50/sq ft and £4.25/sq ft respectively.
Across the UK, London, the South East, and the East Midlands saw the highest rental increases at 8%, 6%, and 5% respectively.
UK land values have also seen major increases at 26.2% over the last 12 months, led again by London at 60%, and the West Midlands at 51%.
Sullivan added: “Warrington continues to attract record high rental levels for prime sites in the North West of England because of its strategic positioning at the very heart of the region’s communications network offering occupiers easy access to regional, national and international markets.
“With the availability of big sheds in the region having declined by 66% since 2010, and the e-tail economy booming across many sectors, developers are responding to the need to redress the imbalance between demand and supply by providing prime locations of more than 100,000 sq ft, thereby explaining the increasing number of speculative schemes underway and proposed over the next 18 months.”