Home cooking kits boost demand for warehouse space in Q3

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Meal kit providers have contributed to the record surge in demand for warehouse space seen in 2020 according to BNP Paribas Real Estate.

This year such providers have more than doubled their warehouse capacity, taking close to 735,000 sq ft by the end of September. Prior to 2020, these businesses occupied less than half of that, with only around 350,000 sq ft of warehouse space in the UK.

Ben Wiley, Head of Industrial & Logistics Agency at BNP Paribas Real Estate, said: “The pandemic has acted as an accelerator and boosted demand for meal kit services, triggered by consumers spending more time at home rather than going out due to the restrictions. Already pre-Covid this concept was gaining momentum due to a trend of increased interest in nutritious meals and consumers’ lack of time.

“To meet this rapidly growing demand efficient temperature-controlled warehouse space, smart warehouse technology and easy access to labour are key for meal kit providers.”

Josh Holmes, Senior Retail & Logistics Analyst at BNP Paribas Real Estate, said: “We expect to see further warehouse demand from meal kit providers and other food delivery subscription services, especially as major grocery chains look to join the fast-growing trend by launching their own recipe box offerings.”

Overall take-up of UK warehouse units over 100,000 sq ft achieved a record high for the second consecutive quarter this year. 13.5m sq ft of units was leased, up 73% year-on-year.

During the autumn, HelloFresh signed for its second production facility in the UK taking an additional 230,384 sq ft at Goodman’s Bermuda Park development in Nuneaton, West Midlands.

Rival recipe box provider Gousto signed for two warehouse units in the second half of 2020, taking 196,178 sq ft at Chillbox a refurbished cold store facility in West Thurrock, Essex. It also leased a 307,807 sq ft distribution centre at Mountpark Warrington Omega Il.

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