The area around Heathrow airport has maintained its position as the most expensive industrial location in the world for the tenth year running, according to a survey by Cushman & Wakefield – Industrial Space Across the World 2011.
The survey also found that occupancy costs and rents in most industrial markets in the UK held firm in 2010. This contrasts with 2009 which saw a marked fall with compressed rents in all regions of the world or the first time in the report’s 15-year history.
The report, which monitors rents and total occupancy costs in 53 countries, reveals that rents in most of the UK industrial locations monitored held firm in 2010.
Karen Thomas warned that some occupiers will need to look to pre-lets to secure the right premises in the Heathrow area. “With the development pipeline effectively turned off, the supply of quality premises will continue to fall in 2011 as take-up eats into existing stock.”
In the West Midlands a steady level of demand and take-up was reducing the availability of grade A and grade B space, said David Binks. “In addition, the lack of speculative development is complementing the reduction in supply, which is leading to a resurgence in the build-to-suit market.”
In the North West, said Jason Print, there had been a significant take up of speculatively developed/good quality accommodation in 2010, however considerable incentives were available to occupiers. “Consequently it is suffering from a lack of supply of good quality accommodation across most size bands which is leading to a reduction in available incentives and some occupiers being forced to consider design & build solutions.”
UK industrial rents
|Location||£/sqm/year||per cent Annual Rental Growth|
|London – Heathrow||131.86||0 per cent|
|London – Hammersmith||102.20||0 per cent|
|London – Gatwick||91.49||0 per cent|
|Manchester||59.00||0 per cent|
|Edinburgh||81.00||0 per cent|
|Bristol||75.00||0 per cent|
|Glasgow||65.00||0 per cent|
|Birmingham||62.00||-5 per cent|
|Cardiff||59.00||0 per cent|
|Newcastle||57.00||0 per cent|
|Leeds||53.80||-5 per cent|