Take up in 2018 was 68.6% higher than the previous high water mark of 5.62 million sq ft (522,115 sq m) in 2014 says Savills. When compared to 2017 take up levels, 2018 was 562% higher. It is worth noting that 2017 was an anomalous year with deals rolling into 2018 and a slight pause as BTS developments came online.
The firm notes that volumes were driven several large deals including Amazon acquiring almost 2 million sq ft (185,806 sq m) of space at Integra 61 in Durham and Clipper taking the refurbished Sheffield 615 totalling of 615,000 sq ft (57,135 sq m). The 100,000-200,000 sq ft (9,290 sq m – 18,580 sq m) size band experienced the highest deal volume in 2018, accounting for 48% of the deals recorded. The 400,000 sq ft (37,161 sq m) band also performed well, accounting for 24% of deals.
In terms of supply, the market has experienced increasing supply constraints due to the rocketing demand. Available supply currently sits at 3.75 million sq ft (348,386 sq m) across 19 units, a 35% fall from 2017. The majority of available supply sits within the 100,000-200,000 sq ft (9,290 – 18,580 sq m) size band – 84% of all space available.
Savills notes there are currently four units under construction throughout the region totalling 804,765 sq ft (74,765 sq m). The largest unit is G Park Doncaster where Gazeley are speculatively developing 275,300 sq ft (25,576 sq m). The pipeline is up 199% on that of 2017.
Dave Robinson, director in the industrial team at Savills Leeds, comments: “The Yorkshire and North East industrial market experienced an exceptional 2018 as a flurry of deals rolled over from 2017 and new schemes came online. There continues to be a strong development pipeline in the region as retailers and logistics companies realise the area is well located for distribution access across the north. Looking ahead to this year we expect there will be further speculative announcements particularly on for larger scale (300,000+ sq ft) as the regions’ prime sites are development out. We also expect activity on the existing standing stock and some built-to-suit, leading to a solid year of take up.”