Shortage of warehouses across Yorkshire leads to surge of speculative building plans

An acute shortage of immediately available warehouse stock has influenced take-up across the Yorkshire industrial and logistics sector but speculative development is on the rise according to commercial property agent Knight Frank.

Following a record year for industrial and logistics transactions in South Yorkshire (including North East Derbyshire) and West Yorkshire (including The Humber) regions in 2021, which stood at 10.3m sq ft, the first quarter of 2022 recorded just over a million sq ft of take-up for units over 50,000 sq ft.

Take-up in the first quarter was restricted by the lack of available premises and the continued levels of occupier demand has boosted developer appetite for new speculative development in the regions.

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Rebecca Schofield, head of industrial at Knight Frank in Yorkshire, said: “Notable deals in Q1 included the pre-let of 430,000 sq ft at Symmetry Park, Doncaster to B&Q.”

Speculative developments underway include Mammoth 602 in DoncasterSpeculative developments underway include Mammoth 602 in Doncaster
Speculative developments underway include Mammoth 602 in Doncaster

She added: “With stock levels in South Yorkshire now at its lowest in years and a vacancy rate at an acute low of 1.3 per cent, strong occupier demand, coupled with the low levels of available stock has amplified the need for new development in the region.

“There is approx. 2.07 million sq ft currently under construction across 12 units in this region, expected to complete later this year or early 2023.”

Nick Wales, investment partner at Knight Frank, said: “Investment into the logistics and industrial sector in South Yorkshire totalled £105.5m in the first quarter of 2022, 29 per cent higher than Q1 2021 volumes.”

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Iain McPhail, Knight Frank partner in Leeds, said: “The first quarter of 2022 recorded 398,300 sq ft of industrial and logistics occupier take-up in West Yorkshire & the Humber.

“While this is over half the level recorded in Q1 2021, the reduction is a reflection of the shortage of stock available in the market, rather than any dampening in occupational demand.”

He added: “The shortage of stock has led to a developer response, with a surge of new reserved matters planning applications being submitted during the past few months alone.”

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