Build distribution hubs near end user, new research concludes

Building consolidation centres close to where people live and work is key to the future of UK logistics, according to property developer Prologis UK, which is funding a report into the future of freight.

It said there was a “damaging misconception” that distribution centres should be sited outside of cities in order to boost sustainability and reduce traffic.

But it added that research showed sustainability gains were far higher if they were built as close as possible to the end user.

Prologis is now helping to fund research by London think tank Centre for London, which aims to show how efficient freight supply chains can be constructed in a post-Covid world.

Centre for London said that with online sales significantly increasing over the last 18 months, now was the time to rethink the mobility of goods.

Rob Whitehead, Centre for London director of strategic projects, said: “Most of us like having low cost and fast home deliveries – and businesses and carriers have been working hard to fulfil this rising demand.

“They also are essential for moving food, medicine and other critical items around.

“But there is a serious risk that goods vehicles will come to dominate our roads, increasing congestion and contributing to poor air quality.”

Robin Woodridge, head of UK capital deployment at Prologis UK, said it was unlikely the increase in home deliveries would return to pre-pandemic levels because of the time it gives people back: “This means we must plan for a future where freight distribution or consolidation centres are located close to where people live and work,” he said.

“There is a damaging misconception that locating these facilities outside of cities is good for sustainability, reducing traffic and improving air quality: that couldn’t be further from the truth, indeed, research has shown that sustainability gains are higher if these facilities are located as close as possible to the end consumer.

“Addressing these misconceptions and encouraging collaboration across key stakeholder groups is a key reason why we are supporting this research by Centre for London.”

A report into the research will be published later in the autumn, with recommendations for policymakers, freight and logistics companies and developers.