Scraping the barrel…

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There is not as much good quality available logistics space as one would think in Scotland.

Big shed take up in Scotland was up 50 per cent last year off the back of the 1m sq ft pre-let to Amazon at Calais Muir South and availability has fallen in the face of demand, according to the latest research from Colliers.

Lambert Smith Hampton’s Industrial & Logistics Market Report 2013 indicates that Grade A stock accounts for under seven per cent of overall stock in the market even though total availability has increased to 33.4m sq ft. Much of this is second hand and not very good second hand stock either.

David Rolwegan of CBRE says: “There has been a lack of large lettings in the industrial sector in recent years.” Some agents are putting this down to the lack of quality warehousing stock and this is only going to get worse.

According to Ryden’s latest annual Scottish Property Review: “The continued lack of significant new development is beginning to limit industrial property options for businesses. Many occupiers continue to mistakenly presume there is an oversupply of property and that securing alternative premises will be an easy task. Those seeking modern well-specified and well-located property may however struggle to identify suitable options and shortages will become more acute with even a limited improvement in the economy.”

Iain Davidson of Colliers agrees: “In terms of looking for good quality space occupiers are going to find it a struggle. Occupiers seem to be under the false impression that there are a plethora of options out there for them but it is just not the case.”

For those looking for warehouse space over 200,000 sq ft the options are rare indeed. Davidson says: “There are just five units in Scotland that are of a decent quality. There are plenty of old manufacturing facilities but many of these are frankly obsolete and not suitable for modern logistics use.”

Prime and strategic locations, particularly in and around the key commercial hubs of Glasgow and Edinburgh have proved popular. Recent deals include the letting of Arisaig Property Partners’ 85,430 sq ft Orion warehouse at Centralpoint, Eurocentral by CBRE and Jones Lang LaSalle to ACS Clothing on a 15 year lease with a break option at year ten on a rent of £426,700 a year, just under £5 per sq ft. Collier advised ACS Clothing.

The newly-built Orion unit, which forms part of the Centralpoint Logistics Park, incorporates modern warehousing and office facilities. It is located next to the M8. There remains one large unit at Centralpoint; the Titan building, which extends to 122,483 sq ft. It is being marketed by Jones Lang LaSalle and CBRE.

At Muse Development’s Eurocentral scheme, a flurry of deals has left just three standing buildings available for immediate occupation. These include the 92,997 sq ft Zenith unit, the 129,183 sq ft Vertex unit and a small unit of 17,000 sq ft. Letting agents are CBRE and Ryden.

Muse Developments sanctioned a £21.2m speculative build commitment in April 2010 to construct two buildings, one of which was Zenith, on the 17.4 acre site known as “Plot F”. This was followed by an additional £33m speculative investment in March 2011 which delivered two further buildings that included “Vertex” on “Plot F” and three smaller units on “Plot B”, all of which were completed in December 2011.

Other immediately available buildings in the region include Blackrock and Evander’s scheme at J4M8 which comprises two stand-alone units of 380,000 sq ft and 242,000 sq ft that can be consolidated to create a single unit of 650,000 sq ft.


The new units have 15m eaves heights, 65 dock levellers and level entry doors and bespoke floors constructed to occupiers’ requirements up to 65kN/sqm. Letting agents are CBRE and James Barr. Good quality second hand space is attracting as much attention as new space. Big Blue Shed at Bellshill Industrial Estate in Lanarkshire, which came back on the market through Jones Lang LaSalle last year was snapped up for £2m by Anderson Precision Gearing.

The building became available due to existing tenant DHL exercising a break option in June 2008. It totals 143,700 sq ft, set on a 6.1 acre site. The building itself offers a clear height of 8.5 to 10 metres, 35kN/sqm floor loading, five dock loading bays, four ground level loading doors, as well as two overhead crane gantries, sprinklers and CCTV monitoring.

Looking at available second hand space letting agents Ryden and Colliers are marketing another former DHL building at 10 Coddington Crescent totalling 80,000 sq ft. The cross dock facility sits on an 11 acre site and is being marketed at £3.75m for the freehold or £4.25 per sq ft for the leasehold. There is confidence that the building will not be about for long.

Davidson says: “Limited development activity has meant that those developers who have been prepared or able to develop schemes have and will continue to be rewarded due to limited competition and an expected gradual increase in demand going forward.”

Steve Turner of Muse Developments says: “There are not many green field sites ready to go especially for those seeking D&B.”

He says that Muse development has 24 acres in three plots at Eurocentral that could accommodate a total of 450,000 sq ft of space. All the plots are fully serviced with planning already secured. “Scottish Enterprise has a further 83 acres available that could be developed at short notice.”

In addition to these sites, Prologis still has land available at its Prologis M8 scheme through letting agents Cushman & Wakefield and Colliers. The plot could accommodate up to 471,000 sq ft of warehouse space.

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