The latest King Sturge survey of available industrial and distribution floorspace indicates that the recent increase in availability may be “finally at, or nearing its peak”. Between April and the beginning of September, availability increased by 1.1% which was the smallest rise since August 2000. The survey reveals that overall availability declined in three regions; Scotland, the North-west and East Midlands.
David Brooks, head of Industrial Agency at King Sturge, says: “We seem to be at last about to turn the corner in terms of the availability of floorspace and this together with the “green shoots” of recovery being seen in the US and UK economies, will encourage greater confidence in the market as a whole.”
The report also states that development of new space has slowed down with available new floorspace having fallen by 0.1% in England and Wales, and by 3.3% in Scotland, with falls being recorded in North-west England, Yorkshire & Humberside, East Midlands and West Midlands. Although the availability of large distribution units (over 10,000sq m) has increased by 2.1% in Great Britain, there are signs this trend may also be turning a corner. Declining availability of large units was recorded in North-west England, East Midlands, South-west England and Wales.
The outlook suggestd that rental growth will remain subdued (or non-existent) for the rest of this year but, assuming the economy continues to recover, rents, may pick up into 2004 as the demand for both standard industrial property, as well as large distribution units, increases.