An unprecedented shortage of industrial space in the UK has brought new significance to the speculative development being undertaken at Symmetry Park in Swindon, according to a leading logistics expert.
Latest data from global real estate advisor Colliers International shows the UK has just over a year’s worth of industrial space left – just 1.3 years nationally, and even less in the South West where industrial availability has declined by 61 per cent since 2009 and just 1.2 years of supply remain.
Tim Davies, the South West Head of Industrial & Logistics for Colliers International, said the figures showed the importance of speculative developments such as the new 217,000 sq ft warehouse at Symmetry Park, for which Colliers is joint agent.
It has been built speculatively by national logistics developer DB Symmetry, and is the first unit on its multi-million pound development at Symmetry Park in Swindon, which has planning consent for 1.3 million sq ft of B8 use space.
“UK industrial availability has fallen on average 62 per cent since 2009, and industrial supply is likely to fall further due to continued demand from e-tailers, lower levels of speculative starts, and the loss of industrial commercial land for other uses such as residential,” said Mr Davies.
“In this context, the development in Swindon of the speculative 217,000 sq ft warehouse development by DB Symmetry at Symmetry Park takes on a new significance as it brings much-needed industrial space to the Swindon area at a time when there is a regional and national shortage.
“There are vast opportunities within the sector as it continues to perform well on the back of unprecedented demand levels.
“The fact that DB Symmetry has chosen to develop this scheme in Swindon should be hugely rewarding for both this forward-thinking company and for Swindon, which benefit from the new jobs created.”
The Colliers International Summer 2017 UK Industrial & Logistics Market Barometer shows that despite the reduction in availability and supply, just 17 million sq ft of industrial space is under construction.
There has been a 60 per cent decline in speculative completions since 2007, according to the data, with new schemes now accounting for just 28 per cent of all UK developments under construction. Colliers predicts that completions will fall by 60 per cent in 2017, to 3.5 million sq ft.
The data also shows that industrial sector continues to attract strong investor interest, with investor volumes of £3.4 billion in the first half of 2017, exceeding the first half of 2016 by 13 per cent.
“Following the outcome of the European referendum, there has been stronger demand for industrial space from the manufacturing sector due to the weakening value of sterling encouraging a surge in demand for British goods,” said Bo Glowacz, Senior Research Analyst, Research and Forecasting at Colliers International.
“The sector now accounts for 27 per cent of the market, up from 19 per cent in 2016; second only to retailers and wholesalers who account for 33 per cent of demand.”