UK logistics occupier demand remained above its long-term average during the first nine months of 2026, despite a sharp slowdown in speculative warehouse development, according to research published by Colliers.
The property consultancy forecasts that just 7.3 million ft² of speculative industrial and logistics space will be completed in 2026, 45% below the five-year average and the lowest annual volume since 2018.
During the third quarter of 2026, speculative completions totalled less than 500,000ft², the lowest quarterly volume in almost a decade.
Meanwhile, take-up of logistics units larger than 100,000ft² reached 6.7 million ft² in Q3, bringing the year-to-date total to 21.8 million ft², slightly above the pre-pandemic 10-year average.
Retail, e-commerce and fulfilment businesses accounted for 78% of take-up during the first nine months of 2026. The Midlands accounted for 63% of space transacted.
Major transactions during Q3 included DHL pre-letting 450,000ft² at Westworks Corby and DIRKS Consumer Logistics securing 306,000ft² in Coventry.
The UK logistics vacancy rate remained at 8.6%, according to the report, although the composition of available space is changing. Newly built availability has fallen by 10.3% over the past year, while second-hand availability has increased by 20%.
New Grade A properties now account for 36% of available space, compared with 43% a year ago.
Deirdre O’Reilly, head of industrial research UK at Colliers, said: “Development activity has slowed considerably, resulting in a shrinking pipeline of new Grade A logistics space coming forward. Although vacancy has risen modestly again, the proportion of new and modern space available is falling, which means occupiers are facing a more competitive environment for the highest-quality space in the right locations.”
Average industrial and logistics rents increased by 4.3% year-on-year in August, while Colliers said prime big-box rents rose by 2.7% annually to September.
However, rent-free incentives have also increased, with average periods rising from 14.8 months in 2025 to 15.8 months in 2026, moderating net effective rental growth.
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