YORKSHIRE’S industrial property market is seeing increased levels of demand in the “big box” sector.
Research by property agency Jones Lang LaSalle showed that units exceeding 100,000 sq ft were in demand from both corporate occupiers and third party logistics operators – many of them chasing contracts with manufacturers.
The property firm’s latest UK Industrial Property Trends research report, which analyses take-up and availability across the country, showed that 1.5m sq ft of industrial and logistics floorspace was taken up in the first quarter of 2012 across Yorkshire.
That’s 42%t lower than activity in the fourth quarter of 2011 when the take-up was 2.6m sq ft and 21% lower than recorded the same time as last year.
The largest decline in take-up involved units from 50,000 to 99,999sq ft where floor space transacted in the first three months of 2012 was 47% lower compared with the final quarter of 2011.
Richard Harris, head of Jones Lang LaSalle’s national industrial and logistics team in West Yorkshire, said: “Whilst occupier demand for 1,000sq ft upwards to 100,000sq ft industrial and logistics units fell in Yorkshire in the first quarter of this year, this trend is in line with the wider UK picture which saw a 24% fall in activity compared with Q4 2011.
“However, we are seeing increased levels of demand in the larger big box sector from both corporate occupiers and third party logistics operators, many of whom are chasing contracts with manufacturers.
“We anticipate this should create an increased rate of take-up in the remaining speculatively-built space, some of which has been on the market for a number of years.”
Said Mr Harris: “Over the short to medium term we also expect to see increased levels of demand from the manufacturing sector as Enterprise Zone initiatives offer attractive incentives for relocation.”
At the end of March, 2012, there was about 39.1m sq ft of industrial and logistics floor space available in Yorkshire – 4% lower than at the end of September 2011.
Availability of space in the region accounted for 12% of the UK total.
Mr Harris said: “The availability of quality smaller industrial product continues to be a concern but with generally static enquiry levels, and difficulties in securing finance, we do not envisage any speculative development for the remainder of this year and into 2013.
“There is still an oversupply of poorer quality second-hand stock across all size ranges and therefore occupiers have a choice of opportunities. This means they can still drive competitive deals.”
