Latest research from Jones Lang LaSalle indicates the amount of new warehouse space available is at its lowest level since records began.
Tim Johnson of Jones Lang LaSalle said: “The availability of immediately available new floor space is now at its lowest level since our records began at just over 8 million sq ft UK-wide. This is 71 per cent below its pre-recession peak of nearly 29 million sq ft in March 2008 – this definitely affected take up levels last year.”
The overall level of availability at the end of December 2012 represented a vacancy rate of approximately 10 per cent across the UK. “However, some regions have a clear shortage of immediately available space” said Jon Sleeman, director EMEA Logistics & Industrial Research at Jones Lang LaSalle.
However overall take-up in 2012 was less than that recorded in 2011 due to a lower level of activity recorded in H1 2012. Overall Grade A take-up in 2012 totalled 11.9 million sq. ft. which stands at 9 per cent lower than recorded in 2011 (13.1million sq. ft.) and is 26 per cent lower the six-year average (2007-2012) of 16 million sq ft.
Despite a slowdown in occupier demand in 2012, total Grade A availability fell. At the end of December this stood at 22.1 million sq. ft, 15 per cent lower than at the end of June 2012 (25.9 million sq ft). There was 8.3 million sq. ft. of new floor space available at this time, including 332,000 sq. ft. of space speculatively under construction (the lowest levels recorded by Jones Lang LaSalle since 2005).
Mr Johnson said: “The availability of good quality space is now a real issue and as a result occupiers are being forced to consider Build to Suit whilst there isn’t the new stock available. Developers who own sites with infrastructure and planning already in place will therefore benefit.”
There are a number of regions where available new supply is well below the recent level of take-up – including the South East and Eastern regions and the North West where we may see some speculative development later this year.
