5 February 2021
Commercial, Development, Industrial & Logistics, SHW News
Continuing strong demand for warehouse and logistics space across the South East last year helped drive take-up in the biggest towns, reports surveying firm SHW in its latest Industrial & Logistics Focus research.
Distribution hotspot Croydon had its best year since 2013 with 424,000 sq ft taken up in 2020 - an increase of 22% on 2019. Demand was mostly for large units linked to last-mile logistics or internet retailing but also included small to medium requirements (10-30,000 sq ft), notably from the healthcare sector.
Croydon availability stands at 674,500 sq ft, up from 580,000 sq ft in 2019, reflecting a vacancy rate of circa 5%. A new rental high of £17.15 per sq ft was established last year for speculative mid-box developments.
Crawley also experienced a rise in take-up and availability last year. Take-up more than doubled to 346,500 sq ft in 2020, with logged demand of nearly 1 million sq ft. Availability climbed to 554,000 sq ft but SHW points out that larger units are still required to meet ongoing demand for logistics facilities.
An estimated 640,000 sq ft is set to come on stream in Crawley in the next 12 to 18 months, including the redevelopment of Virgin Atlantic’s former training facility for 225,000 sq ft of logistics space.
Brighton’s lack of new stock puts it at a disadvantage, with take-up last year falling to a new low of 22,100 sq ft. Much of this take-up was accounted for by Brighton Works, a newly refurbished development of seven units, four of which have let, demonstrating pent-up demand.
Further along the coast, Eastbourne has benefited from a new development of 22 warehouse, industrial and trade units at Polegate, with 75% let or under offer within six months of practical completion. This helped boost take-up in the town to 58,000 sq ft in 2020.
Tim Hardwicke, head of agency at SHW, comments: “The pandemic has accelerated demand for large warehousing facilities in the South East, especially from the big logistics players. But there is still a requirement for smaller units, as evidenced by the take-up of new light industrial and trade counter schemes.
“Some locations are seeing a shortage of immediately available stock of the right size. However, new planned development will bring a healthier pipeline to industrial hotspots over the next 12 to 18 months, by which time it is hoped there will be greater market certainty.”
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