The logistics property sector has undergone a seismic shift in the past ten years as changing consumer habits and the growth of online retail has continued to impact the warehouse market, according to Savills.
It recorded a 285 per cent increase in take-up by online retailers in the past decade, accounting for up to 17.9 per cent of total retail related occupational transactions in 2018.
Savills said its research showed that overall annual take-up has also grown significantly during the last ten years, rising from 12.8 million sq ft in 2009 to 35.1 million sq ft by the end of 2018.
Amazon has seen its warehouse space grow by as much as 1,700 per cent over the past decade, occupying up to 23.4 million sq ft by the end of last year.
The sector has seen a 66 per cent drop in supply since 2008, with vacancy rates at just 6.2 per cent today, with this dropping to as low as 2.4 per cent in prime locations such as London and the South East.
Richard Sullivan, national head of industrial & logistics, said: “For those of us who have been involved in the sector for the past decade, the shift is unprecedented. Ten years ago a number of landlords had higher vacancy rates in their portfolios than the entire market today, which proves just how much has changed. It is hard to imagine how the landscape might look in 2029, but I would not be surprised if we look back with similar amazement.”