Take-up in the UK’s big shed market is down and supply is on the up, according to JLL’s H1 2017 UK Big Box Industrial & Logistics research.
The consultancy said that total occupier take-up was 35% down on the second half of the 2016 boom year, although the figure is still 2% higher than the long-term average. North West take-up for H1 was 591,000 sq ft.
Nationally, the supply of available grade A stock rose in the first six months of the year. As of the end of June, there was 1.1m sq ft of grade A stock available in the North West, which has a vacancy rate below the national average.
In Yorkshire & the Humber, the region’s closest geographic competitor, H1 take-up was 226,000 sq ft and there is 2m sq ft available.
Tessa English, associate director of UK Research at JLL, said: “Manufacturers were the most active source of warehouse take-up in the first half of this year, making up 35% of the total, but retailers were comparatively subdued. Grade A availability increased over the first six months of 2017, following a pick-up in both new and good quality second hand supply.”
Richard Evans, lead director logistics and development, added: “There are a few large requirements in the market at present and we expect this to translate into deals during the second half, however overall we anticipate demand this year to be lower than last.
“With a dwindling vacancy rate of 6% nationally at the end of June, we expect to see the continuing trend of occupiers signing for build-to-suit warehouse units. Our forecasts suggest that distribution rents overall will grow by 2.9% per year nationally over the next five years, with growth stronger in core locations.”
Key deals in the first half of the year included Whistl taking space at Harworth’s Logistics North and Amazon signing at Omega in Warrington.