Big sheds supply shortage sparks rent rise concerns

Lambert Smith Hampton, which has offices in Leeds and Sheffield, said there were 13 units capable of accommodating a total of 2.9m sq ft across Yorkshire, equating to less than 15 months supply based on the five-year average annual take-up.

The result could lead to an increase in rents as occupiers compete for space.

Rob Whatmuff, regional head of industrial and logistics agency, said: "With a diminishing supply of standing stock and no speculative development underway, the market is heading towards an acute shortage of space in the medium term, which is likely to have an upward effect on rents going forward."

This year has seen a change in fortune for the market, driven by the retail sector, with supermarkets, department stores, discount, and internet retailers commanding 79 per cent share of the total take-up during 2010, compared to 34 per cent last year.

Take-up for the second half of 2010 is currently 57 per cent higher than last year's total annual figure of 1.17m sq ft. Total take up in 2010 currently stands at 2,771,705 sq ft.

Mr Whatmuff said: "It's no secret that retailers are fiercely competitive and keen to take advantage of the best bargains in order to drive efficiencies. The historic oversupply of big shed units across Yorkshire has provided an opportunity for them to acquire brand new buildings at significantly reduced prices, the likes of which many will have never seen before, nor will they for a significant period of time if the trend continues."