Freight News, Logistics

UK faces warehouse squeeze

[ September 29, 2015   //   Chris ]

Prime logistics locations could be facing a shortage of land for logistics purposes, according to a new survey by the UK Warehousing Association (UKWA) and property consultancy, Savills.
While the UK has a total of 424 million sq ft of warehousing space, there is a critical lack of supply and development, says the report, ‘The size and make up of the UK Warehousing Sector’ published on 28 September.
The report found that supply of warehouses in the UK currently stands at 32 million square feet, giving a vacancy rate of 7.5%. However, Savills classifies 6.5 million square feet as low-grade C stock, which may never be occupied again as they are not fit-for-purpose for today’s logistics requirements, so the vacancy rate is even lower.
The study also reveals that 51% of take up has been for Build to Suit units, meaning that land will become increasingly scare in prime logistics locations.
The East Midlands has the highest amount of space, accounting for 18%, occupiers from different sectors have a need to be in certain locations and require diverse unit sizes.
Head of industrial research at Savills, Kevin Mofid, said: “The availability of modern and fit for purpose warehouse space has the potential to be a real pinch point for the logistics industry in the coming years. Whilst this initial white paper doesn’t quantify the amount of allocated land in pipeline many schemes that we are tracking are not necessarily deliverable in the short term.
“This paper will help frame the debate on the importance of logistics real estate to the logistics industry, and the vitality of the UK economy moving forward.”
UKWA chief executive Peter Ward (pictured) added: “This report reveals the true scope of the property challenge facing the logistics sector and UK plc. We call on policy makers, both nationally and locally, to acknowledge the importance of the logistics industry and to deliver policy which allows for the growth of the space required for our industry to continue delivering.”
For a copy of the report visit: www.ukwa.org.uk

Tags: UKWA