Supermarkets turn to industrial sector to manage surge

Warehouse demand has risen across the region from supermarkets and grocers to deal with the surge in demand caused by the coronavirus. Marks & Spencer, Aldi and Sainsbury’s are among those searching for vacant warehouses.

It is understood that Aldi is currently on the nationwide hunt for 1m sq ft of space on a short term lease to fulfil customer demands.

Jason Print, partner at Gerald Eve, explained that several large requirements for immediate short-term space had come to market for existing units from 100,000 sq ft to 1m sq ft.

“Some are for cold store facilities from the big supermarkets,” he explained, “with others simply requiring space to bulk or block store surplus stock while they re-configure existing warehouses to focus on faster selling stock due to the recent change in shopping habits.”

Simon Roddam, director of real estate consultants BE Group, predicts that “short term leasehold requirements from the retail and medical distribution sector could spike to satisfy greater demands, which could provide income for landlords through this challenging period.”

Andrew Lynn, partner at DTRE, said short term space requirements of between three months and a year will become a “massive issue” in the foreseeable future and that there is going to be a huge demand in warehouses on short leases.

Lynn highlighted Logistics North in Bolton, Kingsway in Rochdale, and Icon at Manchester Airport as prospective industrial sites that have warehousing available and said that there were a number of available opportunities in the region and that supermarkets “can be accommodated.”

Rob Tilley, partner in industrial and logistics at Knight Frank, said companies were in the “reactive phase” and assessing the situation hour by hour. 

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