The continuing importance of Amazon to the UK and European warehousing markets has been underlined in the annual results of developer and landlord Segro.
Its financial statement for the year to 31 December 2017 said that Amazon occupied around 2.7 million ft2 of its space in the UK, Germany, Spain and Italy during 2017 in both big box and urban warehouses.
It was also among those contributing to growing levels of take-up. Half of Segro’s customers are involved in businesses affected by e-commerce, including 3PLs, parcels businesses and retailers – between them accounting for 60% of take-up during the year.
Overall, Segro’s pre-tax profit rose by 25.7% to £194.2m. It benefited from £29m of rent from pre-let, build-to-suit development and speculative development being let prior to completion. This included “£9m from retailers, including Italian fashion retailer Yoox Net-a-Porter and Amazon”, the company said.
Segro has 12.9 million ft2 under construction or in advanced pre-let discussions, equivalent to a fifth of its current portfolio which includes the 5.4 million ft2 Slough Trading Estate.
“The structural drivers of demand in our sector (urbanisation, growth of the digital economy and e-commerce) are likely to underpin occupier demand for some time to come,” the company said.
Despite a lower level of UK take-up by Amazon in 2017 compared to the year before, it remains very active in the market. So far this year it has announced plans for a 290,000 ft2 fulfilment centre in Rugby – at Rugby Gateway which is a joint venture between Segro and Roxhill Developments – creating 400 new jobs.
The new Rugby facility is Amazon’s fourth in the Midlands. It already operates from Coalville, Daventry and Rugeley. It will open further centres in Bristol, Bolton and Coventry during the year.
