Take-up of large warehouses in 2017 fell by 36% compared to the year before, according to new research from property agent JLL.
The company’s 'UK Big Box Industrial and Logistics Market' report found that 15.4 million ft2 of good quality Grade A space was leased or sold during the year in buildings above 100,000 ft2. This was 11% below the average for the last 10 years but in line with the five-year average.
Despite last year’s fall, around 7 million ft2 of further take-up has been agreed and is currently in solicitors’ hands. A strong level of demand is also expected later this year.
Jon Sleeman, director of JLL’s industrial and logistics research, comments: “Our prediction is that overall demand will be slightly higher than seen in 2017 partly due to a healthy pipeline of deals which we expect to conclude in the first quarter of the year. In addition, we continue to monitor a high level of active requirements in the market which should support take-up over the second half of the year.”
The majority of deals that took place in 2017 involved newly-built warehouses. These came to 10.9 million ft2, with the remainder good quality second-hand space. Retailers were the most active source of demand, accounting for 37% of deals and the most active region was the South East which was responsible for 39% of overall take-up.
There was a mixed picture in terms of availability which by the end of 2017 was 3% lower than the middle of the year but 21% higher than the end of 2016.
