Sunday 20th Jan 2019 - Logistics Manager Magazine

South West: The time is ripe


The scent of rising rents in the air is stirring developers to dust down old plans for development – could it be good news for occupiers? Liza Helps reports.

First published in Logistics Manager, May 2015.

First published in Logistics Manager, May 2015.

There wasn’t a single deal done over 50,000 sq ft in the second half of 2014,” says Russell Crofts of Knight Frank, “but this isn’t a reflection of weak demand rather a reflection of the lack of supply.”

Jeremy Hughes of BNP Paribas Real Estate points out: “It’s going to be pretty hard to be honest there just isn’t the stock. Occupiers are having to think laterally.”

“There are three options: wait, new build with 12–24 month delay, or take something bit more or less than required for two or three years and review the situation.”

There are buildings available if you look hard enough, though they might not necessarily be the right size, in the right location or indeed even Grade A.

The majority of inquiries are for buildings between 50 – 75,000 sq ft or else between 100 – 200,000 sq ft. Having researched the market, GE Capital owner of Crossflow 550 is submitting plans to have the remaining 336,079 sq ft split into two units of 140,000 sq ft and 180,000sq ft to hit that sweet spot. The building (which was split into two in 2013 with lease of 211,000 sq ft to Culina Logistics at a rent of £6 per sq ft) benefits from a 12m clear height, 25-dock level and four level access doors. It is being marketed by Knight Frank, JLL and Savills.

There is the 4015,512 sq ft Brabazon building on the West Way north of Bristol through CBRE, to the 170,896 sq ft Steel Point unit in Yate through GVA and JLL.

Colliers has a 250,763 sq ft former Asda in Portbury and in Gloucester High Roller, the 258,864 sq ft ex Wincanton warehouse, is available through Cushman & Wakefield.

“If you are prepared to wait though,” says Tim Davies of Colliers, “there is lots of land available for D&B.”

There are two schemes in Swindon each of which could accommodate up to 400,000 sq ft, Graftongate and ING’s 30-acre Ecco scheme and the remaining land at Gazeley’s G.Park Swindon. There is also 150 acres near the junction of the A420/A419, which although not even zoned for employment yet could ease demand in the future.

Developer Bericote has the 62-acre ex-Rhodia site known as Bericote Portside, which could accommodate up to 1.1m sq ft. Indeed the developer has planning permission for a single unit of up to 1m sq ft. Units are available from 100,000 sq ft. Agents are Hartnell Taylor Cook and Dowley Turner Real Estate. There is also Avlon Park at Severnside, Bristol with planning for 1.3m sq ft. Units are available on a D&B basis from 60,000 sq ft to a single cross docking facility of in excess of 1m sq ft. Agents are Dowley Turner Real Estate and Colliers.

There are still two plots at Gazeley’s G.Park Bristol, which could take 96,317 sq ft and 250,128 sq ft. And there’s the 296-acre Westgate site in Severnside, being brought forward by Harrow Estates and Robert Hitchins totalling 2m sq ft. It can accommodate a single unit of 1m sq ft. Agents are JLL, Hartnell Taylor Cook and DTZ.

In Wales, Renishaw is proposing a scheme in Miskin, Cardiff that could accommodate a single unit of up to 1m sq ft. The scheme has yet to win planning. Robb Ladd of DTZ says: “Although land is available quite a lot of it needs facilitating work to bring it forward.”



One where that is not required is Delta Properties and Roxhill’s 600-acre Central Park scheme in Severnside, Bristol. With infrastructure now in and planning already secured via a permitted development order buildings can be up within six to nine months.

The scheme could accommodate up to 1.3m sq ft in a single unit and the first phases have planning for a total of 4.4m sq ft. The whole site could accommodate up to 10m sq ft. Letting agents are GVA and Knight Frank.

With a shortage of stock and increasing demand comes a glimmer of hope for occupiers, says Paul Hobbs of GVA: “The more positive sentiment [from occupiers] coupled with strong interest from investors has probably started to get developers to look at old proposals on speculative new builds. Most developers and investors have done infrastructure works and have geared up procurement but have not pushed the button.”

One developer that has is St Modwen, which is pushing forward with a series of speculative developments in the region. It is building three units totalling 107,000 sq ft at its 212-acre Access 18 scheme off junction 18 of the M5 in Avonmouth. This is in addition to a D&B deal signed with parcel distribution firm, myHermes, for a 43,100 sq ft unit. Rumour has it that one building is under offer and most agents expect all three units to be let by completion. Letting agents are Alder King and Knight Frank.

St Modwen is also speculatively developing two units at its 16-acre Gateway 12 scheme on Waterwells Business Park in Gloucestershire, and constructing an access road.

Scheduled to complete this summer, the first unit on site will provide 40,950 sq ft of space available for purchase or rent by firms looking to expand or relocate in the area. Agents are Ash & Co and Alder King. A third speculative scheme is being put forward in Wales. The company submitted a planning application to start work on an access road and the first speculative commercial unit within the 100 acre Celtic Business Park at its £1bn Glan Llyn development in Newport.

Subject to planning consent, St Modwen expects to start work on site in Spring. The speculative warehouse will total 50,000 sq ft and be available to let or buy.

Neil Francis of Knight Frank says this is a brave decision: “Build costs for industrial space are too high for the rental/capital returns achievable even at £5.50 per sq ft – the top end of the market.”

Francis believes that the Welsh Government should intervene to kick start activity. Outside Wales rents in the region are starting to firm and in some cases even rise. St Modwen is looking for £6.95 per sq ft at Access 18.