According to DTZ’s Property Times UK Industrial Q2 2012 report, which covers the market for properties over 50,000 sq ft., take-up of industrial space rebounded in Q2 to 8.1 million sq ft compared with 5.8 million sq ft in Q1, the highest level for two years and over 5 per cent ahead of the same period in 2011.
The automotive sector was the driving force behind two of the larger lettings in Q2, with Vantec Europe taking 420,000 sq ft in the North East to service a Nissan logistics contract and Jaguar Land Rover (operated by DHL) taking 405,000 sq ft in the North West to facilitate an expansion of its Halewood plant.
A total of 64 deals were transacted in Q2, an increase of 33 per cent. The average deal size however remained relatively low at 126,000 sq ft as demand was constrained by lack of availability of good quality stock at this end of the market. Total availability fell during the quarter to 143 million sq ft, down 6 per cent from Q1.
Grade A take-up fell for the fourth successive quarter as the lack of availability restricted demand and occupiers switched their attention to the more abundant good quality grade B stock. The relative scarcity of grade A space means that despite the fall in take-up, availability fell 10 per cent to 18 million sq ft.
The report also revealed that the profile of occupiers has changed in the last 12 months, with take-up by logistics companies increasing to 16 per cent, largely due to space being taken by Royal Mail and Parcelforce.