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UK | 2019
Colliers international
Comprised of Revenue Managing
15,400 $2.7bn 2bn LONDON & THE SOUTH EAST 6
Professionals (US $) sq ft
WEST LONDON 8
SOUTH WEST 10
MIDLANDS 12
Offices Transaction Established
16 $116bn 69 NORTH WEST 14
UK & Ireland Value (US $) Countries
YORKSHIRE & THE NORTH EAST 16
SCOTLAND 18
Lease/Sale People People NORTHERN IRELAND 20
68,000 830 3,400
Transactions UK & Ireland EMEA CONTACTS 22
2 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 3Occupier demand in 2018 surprised on the upside with take-up for larger and better
quality units driving activity nationally. Following on from the above-average performance
witnessed in 2017, 2018’s provisional data shows that full-year take-up for distribution
warehouses (100,000+ sq ft) could potentially break 2016’s record take-up of circa 32
million sq ft, up approximately 18 per cent year-on-year. As a result, national supply remains I am pleased to launch our 2019 Industrial and Logistics
Andrea Ferranti very tight with circa 30 million sq ft of space available as of end-December 2018. brochure, which is designed to give you an overview of
Head of Industrial &
Logistics Research, Good market fundamentals in a low-supply environment will exert inflationary pressure on activity in the regional industrial markets. I hope you find
rents and increase intensity of land use, particularly in London and key South East locations.
Colliers International
our latest publication informative and useful.
Despite the ongoing political and total returns are expected to be 6.6
economic uncertainty generated by per cent. Developers have responded
Brexit, occupational demand has cautiously with spec development and
been buoyant on the back of steady, an increasing number of build-to-suit
Colliers Collaborations if uninspiring, economic performance. solutions and we expect there to be a
Combined with limited new build similar pattern in 2019. However, First
activity and an acute shortage of Panattoni has been dominant nationally,
Colliers International’s Industrial and quality stock in many locations, the with regard to UK spec development.
Valuation & Advisory Services Business Space Lease Advisory
Logistics team provides specialist subsequent rental growth has resulted To date, they have spent c. £500
real estate services for investors, in the industrial sector again being the million on sites alone and account
developers and occupiers. We standout performer. for a large share of the spec market.
collaborate with the services of the
Corporate Solutions Industrial Residential Development
Nationally, prime rental growth for I’m pleased to report that the Colliers
wider UK and EMEA business offering Small Sheds (10,000–30,000 sq ft) International Industrial & Logistics
our clients a joined up approach to all was 6.2 per cent in 2018, a slight team have had a record year and have
Investment Property Management Rating Debt Advisory
of their real estate requirements. increase over the 5.5 per cent growth been involved in transactions totalling
seen in 2017. For prime units of c. 20 million sq ft across the UK in the
100,000+ sq ft, 2018 rental growth last 12 months – a snapshot of which
was 3.5 per cent, a slight decline over are detailed in this publication. With
the 4.8 per cent of 2017. Rental growth extensive national coverage, the team
for All Industrial property in 2019 is well-placed to offer knowledgeable
is expected to be 2.5 per cent, with occupational, development and
London being the strongest performing investment advice tailored to your local
region, at 4.0 per cent. market. Our success has been down to
Colliers International is a global leader
a number of factors, including a strong
in real estate services with more than The strength of demand is also reflected
EDINBURGH regional team and key individuals on
15,400 professionals operating in 69 GLASGOW in a 20+ per cent year-on-year increase
the business development and supply
countries. in land values, with an annual increase
NEWCASTLE chain side.
of 70 per cent in the West Midlands as
As a subsidiary of Colliers International BELFAST
supply constraints impact. For an informal chat, please do not
Group Inc. (CIGI) which is listed on LEEDS
hesitate to get in touch with either myself
the NASDAQ and TSX as CIGI, it DUBLIN The industrial sector has had two
SHEFFIELD or one of the team. I look forward to
provides clients with accountability and LIVERPOOL stellar years in terms of investment
meeting you personally.
enterprising real estate solutions. MANCHESTER performance, delivering high and
BIRMINGHAM mid-teens total returns in 2017 and
2018. The sector will remain the top
CARDIFF
LONDON performing sector in 2019, but with LEN ROSSO
only selective and limited further Head of Industrial & Logistics
yield compression expected, 2019 +44 7831 436 096
BRISTOL
4 INDUSTRIAL & LOGISTICS | UK 2019 JERSEY Colliers International 5DIXONS CARPHONE
Acquisition
Mid Kent Business Park, Snodland
The Industrial and Logistics Occupational Market good take-up but with fewer opportunities.
Gazeley’s spec built Latitude 186 unit in
market within London and
Milton Keynes was let in 2018 and the new
the South East remains strong. spec built Altitude 574,000 sq ft unit, on the
In 2018, to the end of November, the
Demand from a diverse range 100,000+ sq ft sheds market saw a 22 same estate, is rumoured to be under offer
of occupiers and very limited per cent increase in take-up over 2017, to to Amazon.
availability of quality stock 2.5 million sq ft. The two largest leasing Annual rental growth for 100,000+ sq ft For more information
is contributing to rental transactions were: 1) the letting of 750,000 sheds in the South East is currently running please contact:
sq ft at Magna Park, Milton Keynes to H&M
growth and rising land at 6.4 per cent, with 10,000-30,000 sq ft DB SYMMETRY
on a 20-year lease at £6.25 psf, and 2) units at 8.1 per cent. Top rents are at Park Leasing
prices in most locations. SEGRO’s letting of 452,084 sq ft at Axis AGENCY
Royal (10,000-30,000 sq ft) have seen a Symmetry Park, Biggleswade
Park, Slough, to Royal Mail on a 15-year further increase in 2018, to £20 psf, with a
lease at £12.50 psf. Supply of Grade A William Bellman
number of Greater London locations in the
Investment Market existing warehouses over 100,000 sq ft mid-teens or higher. Borehamwood, at £15
+44 7881 553 904
william.bellman@colliers.com
remains low within the region, standing at psf, tops the South East rents.
c. 925,000 sq ft as of the end of November.
As of mid-December, the London and South Labour availability remains a key location
East investment market had transacted £1.8 Occupiers have limited choice and James Haestier
attractor and, with increasing warehouse +44 7818 038 009
billion (Property Data), a third less than this has led to 2018 being dominated automation, the availability of sufficient james.haestier@colliers.com
2017’s total. London, in particular, saw a by large freehold land purchases to power supply is becoming crucial.
sharp fall in transactions, to less than £900 owner occupiers, for example, Lidl
million, with only four transactions >£50 buying 58 acres in Houghton Regis
million, the largest being Hyde Group’s and Aldi (20 acres) and B&M (22 acres) Akhtar Alibhai
purchase of Charlton Riverside, a four-unit +44 7909 684 801
both buying sites in Bedford. Between
akhtar.alibhai@colliers.com
scheme adjacent to the Thames Barrier. them they are set to deliver approximately GOODMAN
3 million sq ft of distribution space. Leasing
In the South East, the Sovereign portfolio
Recently, it has been reported that London Medway Commercial Park
(Island Road Reading and South Central, Tim Harding
42 acres at Barking Power Station is
Southampton) was bought by LaSalle +44 7860 180 328
under offer to City of London Corporation. tim.harding@colliers.com
Investment Management for £95 million,
representing a 4.6 per cent initial yield. The lack of existing stock within the
The largest single asset transaction was South East is forcing occupiers to be
First Panattoni’s purchase of a 150,000 less location-specific when looking for Georgia Pirbhai
sq ft unit at Elstree Way, Borehamwood for opportunities. Locations along the A1 +44 7599 533 143
georgia.pirbhai@colliers.com
£53 million. (M), such as Biggleswade, and the M40
(Banbury and Bicester) are seeing spec
Prime yields in London are sub-4 per cent,
rising to 4.25 per cent in the best South
built units quickly leased. More established DP WORLD Investment
locations, such as the M1, are still seeing Leasing
East locations.
John Hanson
London Gateway Logistics Park +44 7825 251 894
john.hanson@colliers.com
6 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 7AVIVA INVESTORS
Leasing
UX Uxbridge Industrial Park
West London has seen a good Occupational Market There is limited speculative development
coming forward, but this tends to be in
level of take-up which has
larger units, such as the SEGRO Park,
seen availability constrict and Hayes scheme due to complete in 2020,
There is a very limited supply of land in
has therefore pushed rental West London, either built-to-suit or for sale, which will offer c. 230,000 sq ft in four
levels to all-time highs. In the with no supply of new build units in the units. Further, L&G has just been granted
Park Royal location, rents on wider A40 corridor and Heathrow. There planning for c. 170,000 sq ft of new build For more information
in two units on the former BA unit at please contact:
second-hand modern units are is also a limited supply of good quality
second-hand units in this location. Quoting Bullsbridge, North Hyde Gardens in Hayes.
now in excess of £20 psf but SEGRO
and achieved rents for 10,000-30,000 sq Colliers International has recently let five
there has been no new build ft units are continuing to increase, with Leasing AGENCY
units, ranging from 10,000-20,000 sq ft
recently to ascertain what Heathrow now at £16 psf and Park Royal on behalf of Aviva Investors on the West
SEGRO Park, Hayes
levels this would achieve. at £20 psf. Upward rental pressure will be London portfolio and have current interest
Patrick Rosso
+44 7825 571 048
Heathrow has also seen good maintained into 2019. in their new scheme in Uxbridge, with patrick.rosso@colliers.com
levels of take-up and again The supply side is continuing to decline due two units remaining (c. 37,000 sq ft and
with limited supply has seen to the current levels of demand, which shows 134,000 sq ft). The International Trading
Isa Naeem
no signs of slowing down, especially in the Estate, in Southall, has seen good take-
rents of circa £16 psf. up in 2018 and Colliers International has
+44 7889 432 972
smaller size range of c. 5,000-30,000 isa.naeem@colliers.com
sq ft. There have been a few larger deals in recently let c. 120,000 sq ft in three lettings
2018, which has seen the larger speculative on behalf of Royal London.
Investment Market schemes starting to fill up. Recent leasing INVESTMENT
deals include: FedEx taking Heathrow Skyline AVIVA INVESTORS Michael Kershaw
The West London investment market has (80,000 sq ft) at £15.50 psf, DB Schenker Leasing +44 7834 083 126
seen limited transactional activity in 2018, taking 60,000 sq ft at Hayes 180 at c. £13.95 Riverside Way, Uxbridge michael.kershaw@colliers.com
primarily due to a lack of product available psf and SEGRO pre-letting 230,000 sq ft to
to be bought. The most significant deal was Do & Co, a food operator who secured the BA
M&G’s purchase of Gate Centre, Brentford contracts, at an undisclosed rent believed to
for £34.3 million at a yield of 3.15 per cent. be around £16 psf.
This level of pricing is further supported by Park Royal still leads the market in terms
Capital Industrial’s purchase of 15 Havelock of rents, with the letting of c. 7,000 sq ft
Terrace, Battersea for £8.5 million, at Tudor Estate at £22 psf, setting a new
reflecting a yield of 3.20 per cent. benchmark for this size of unit and sets a
Prime yields are now sub-4 per cent and precedent for future expectations.
remain under pressure as investor appetite
from a range of capital remains insatiable. AVIVA INVESTORS
Leasing
Stockley Close, West Drayton
8 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 9TREBOR DEVELOPMENTS
New Instruction
Central Approach, Avonmouth
The South West continues to in excess of £20 million, both multi-let well and rents for 5,000-10,000 sq ft
estates: Royal London Asset Management’s units are now achieving upwards of £9
perform well and the region
purchase of Stover Trading Estate, Yate, psf and, in some cases, are approaching
remains relatively unaffected for £21.69 million at an initial yield of 6.66 double figures.
by the uncertainty created by per cent, and IPIF’s purchase of Kingsditch
Other areas of the South West are also
the UK’s imminent departure Trading Estate, Cheltenham for £20.5
thriving, such as Gloucester, where
from the EU. The underlying million at a yield of 5.3 per cent.
Arlington has recently secured a pre-let
For more information
fundamentals of the market Prime yields in the key South West regional of 183,000 sq ft at Gloucester Business please contact:
in the South West remain towns/cities have remained stable, with Park to Dowty Propellers. Furthermore,
CHANCERYGATE
strong; in particular, supply Bristol prime yields at 4.75 per cent. St Modwen has recently been granted
planning at Quedgeley East Business Park,
Acquisition AGENCY
levels remain very low and where they intend to speculatively develop
Furlong Park, Cheltenham
occupiers are competing Occupational Market a range of industrial units following the
Tom Watkins
+44 7917 093 167
aggressively for the available success of Gateway 12 at Waterwells tom.watkins@colliers.com
stock. This is maintaining There has been a lot of activity in the
Business Park.
upward pressure on rents. South West Industrial market in the last 12 The abolishment of the Severn Bridge tolls James Short
Demand remains consistently months. Developers have recognised the on 17 December 2018 will unlock the region +44 7720 073 227
strong, predominantly on chronic shortage of stock and there are and enhance connectivity into South Wales. james.short@colliers.com
several speculative developments underway This will also improve access to labour from
the back of the buoyant
in Bristol that will absorb the latent South Wales into Bristol and the South
e-commerce market. demand. Recent examples of developers West and make stretches of the M4 corridor INVESTMENT
responding include Trebor Developments’ from Newport to Cardiff more viable for DB SYMMETRY
occupiers; watch this space. Leasing Richard Coombs
proposal to speculatively build 244,000
Investment Market sq ft over three units on a 15 acre site in Unit 1 Symmetry Park, Swindon
+44 7795 652 030
richard.coombs@colliers.com
Avonmouth and, Chancerygate, who are
The limited availability of investment stock well advanced with speculative schemes at
in the South West has held back volumes Vertex Park and Warmley Business Park in
in 2018. In the year to end of November East Bristol, which will offer two small unit
2018, volumes stood at £195.6 million, schemes by the end of Q1 2019.
significantly short of the £440.8 million Horizon 38 in Filton set a record rent in
achieved in 2017 (Property Data). There is the region for over 100,000 sq ft with the
a general nervousness amongst investors letting of 115,000 sq ft to Apec Braking
about recycling money, hence stock coming at £7.25 psf and, given the imbalance
to market has been limited. between supply and demand, there’s
COLLIERS CAPITAL
The market has lacked any sizeable £50+ reason to suggest rents could continue to
New Instruction
million deals, with just two transactions rise. Multi-let estates continue to perform
Capital One, Bristol
10 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 11CSM BAKERY SOLUTIONS
Leasing
DC7 Prologis Park, Daventry
Go big or go home seems to Tritax Big Box REIT made two substantial
Occupational Market
commitments in the East Midlands at
be the motto for 2019, with
Corby, Midlands Logistics Park – firstly,
2018 turning out much as purchasing the Eddie Stobart 844,000 The Midlands Industrial and Logistics
we had predicted. Coupled sq ft pre-let for £81.8 million (5 per cent market has been very buoyant, mainly
with very active take-up from initial yield) in February and secondly, driven by the continued demand from the
October through December; buying the 945,000 sq ft Bosch unit for online sector, including the usual suspects, For more information
£89.3 million (5.2 per cent initial yield) please contact:
the East and West Midlands such as Amazon, but also new entrants
in October. The largest transaction in the to the market who are clustering around
will have seen over 12 million West Midlands was the Lime Property GAZELEY
parcel hubs as customer demand for late
sq ft (Grade A over 100,000 Fund purchase of a 490,000 sq ft unit at night online shopping and next day delivery Leasing AGENCY
sq ft) transacted, exceeding an Coventry, Ansty Park for £73.4 million. requires ease of access. Tornado Magna Park, Lutterworth
already strong 2017. With the Other notable deals include NFU’s These hubs, such as the new super DPD
Simon Norton
+44 7788 436 273
East Midlands dominating in commitment to forward fund The Hub in hub at IM Properties’ Hinckley scheme, simon.norton@colliers.com
2018, we see this continuing Birmingham, which was pre-let to Kitchen are land hungry and take a lot of the
for another strong year for the Craft on a 25 year lease, achieving a price development pipeline instantly out of the
of £33.9 million and reflecting a net initial Peter Monks
market which, in turn, drives up land values.
Industrial and Logistics sector yield of 4.6 per cent. Also, Aberdeen
+44 7766 504 989
We are also seeing strong demand for the
in the region. Standard Investments’ purchase of DC3 mid-box market (50,000+ sq ft) and record
peter.monks@colliers.com
Prologis Park, Fradley in Lichfield, which rents are being achieved in this size bracket,
offered 20 year income and achieved a with a M42 rent of £8 psf being achieved
Investment Market net initial yield of 4.5 per cent. Multi-lets at Connexions. Colliers International is Richard Meering
are also performing strongly and achieving
CABOT PROPERTIES +44 7771 633 831
instructed on some large occupational
record pricing, with an estate in Kings
Leasing richard.meering@colliers.com
acquisitions throughout the Midlands and are
The Midlands remains one of the strongest C172 Brackmills
Norton sold to Royal London in December encouraged by the continued demand we are
investment markets outside of London.
2018 at £134 million, reflecting a yield of seeing in the sector.
Again, shortage of quality stock has held Sam Robinson
4.25 per cent. +44 7825 437 213
back transaction volumes. As of the end of
sam.robinson@colliers.com
November 2018, volumes were just under Prime yields in Birmingham remain stable
£1.1 billion, a very strong performance, but at 4.5 per cent, with other key Midlands
the year-end numbers will fail to match the centres 25 bps higher at 4.75 per cent.
£1.5 billion cleared in 2017 (Property Data). INVESTMENT
Chris Bampton
+44 7825 603 211
chris.bampton@colliers.com
DB SYMMETRY/BA PENSION FUND
Leasing
Units 7 & 8, Central M40
12 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 13ROPEMAKER PROPERTIES
Leasing and Sale
Kingsway Business Park, Rochdale
Both occupier and investor Prime yields in Manchester remain stable With post-recession speculative
at 4.25 per cent, with other key North West development now being absorbed, strong
demand remain at healthy
locations up to 50 bps higher at 4.75 per demand has led to both Mount Park and
levels as we move into cent. This level is supported by Colliers Exeter Group/First Industrial building
2019. As with other regions, Capital’s recent purchase of a prime speculative units of 346,000 sq ft (Omega,
the availability of quality logistics unit at Revolution Park, Chorley Warrington) and 375,000 sq ft (Logistics
investment product has held for £20.35 million, reflecting a yield of 4.65 North, Bolton), respectively. For more information
per cent. There remains strong investor please contact:
back investment volumes In 2018, two large pre-let deals were
demand across all grades, with good
to a degree, but a diverse secondary stock achieving 5.25 per cent.
agreed, with Amazon taking 360,000 sq ft
WILSON BOWDEN
range of occupational at M6 Major, Haydock and Movianto taking
360,000 sq ft at Haydock Green. The
Pre-sale AGENCY
demand is continuing to demand for large box units has prompted
Kingsway Business Park, Rochdale
support rents and further Occupational Market US Fund Hillwood to agree a JV with
John Sullivan
+44 7702 908 353
speculative development. Bericote at M6 Major, Haydock to spec john.sullivan2@colliers.com
The North West market for units 100,000+ build 523,000 sq ft, to be completed by the
sq ft has remained very buoyant throughout end of 2019.
Investment Market 2018. This is evidenced by the dwindling Rental levels have continued to rise, Nathan Khanverdi
number of good quality Grade A and with record rents set for both prime and
+44 7594 091 365
secondary units. Big Shed availability has nathan.khanverdi@colliers.com
Investment volumes in the North West will secondary units. Royal Mail’s deal at
declined by 66 per cent since 2010 in the Mountpark’s, Warrington Omega scheme
be close to £500 million in 2018, down by
region, when it stood at c. 18 million sq ft.
c. 15 per cent on recent years. Shortage of
The next wave of speculative warehouse
achieved £6.25 psf, a record for Big Shed INVESTMENT
quality stock remains an issue for investors prime rents. Rental levels on 10,000 – SEDDON DEVELOPMENTS
development of 100,000+ sq ft is now 50,000 sq ft units are now achieving above Freehold Acquisition James Preston
keen to gain representation in the region. At +44 7740 542 207
under way, with c. 3.1 million sq ft under £7 psf as demand continues to outweigh Allan House, Bredbury Stockport
the end of November 2018, volumes were james.preston@colliers.com
construction in 13 schemes across the the supply of Grade A warehouses.
£427 million (Property Data).
North West.
Tritax Big Box REIT was responsible for
In 2018, it is estimated that take-up for units
the two largest transactions, purchasing
of 100,000+ sq ft will be close to 5 million sq
Weston Road, Crewe (387,500 sq ft), let to
ft, an increase of 1.6 million sq ft over 2017.
Expert Logistics, a subsidiary of AO World
Plc, for £36.1 million (initial yield 5.4 per Occupier requirements are healthy, with
cent) and Florida Farm, Haydock, a 361,100 interest on almost all currently available
sq ft unit pre-let to Amazon for £68.7 buildings. Only three buildings, totalling
million, representing an initial yield of 4.9 457,000 sq ft, remain, with keen interest in
per cent. all of them. Assuming all deals complete,
CROMWELL PROPERTY GROUP
year-end Grade A stock will stand at 1.2
Freehold Disposal
million sq ft (less than 6 months’ supply).
Fort Business Park, Manchester
14 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 15LONDON SCOTTISH
Freehold Disposal
Cortonwood Drive, Barnsley
The Yorkshire and North East June forward purchase of Symmetry Park, rather than floorplate, and with the internal
Darlington for £120.7 million at a yield of 5 area customised for robotics and electronic
Industrial and Logistics market
per cent. This build-to-suit facility, pre-let picking systems. Another major leasing
performed well in 2018, to a major international online retailer, event was the letting of Logicor’s Sheffield
benefiting from the availability totals over 1.5 million sq ft of gross internal 615, Shepcote Lane (614,497 sq ft) to
of consented sites and quality floor area over ground and two mezzanine Clipper for a contract on behalf of retailer
standing stock, strong occupier levels. The second largest transaction was Pretty Little Thing at a rent of £5 psf. For more information
also in Darlington, at Lingfield Point, where please contact:
demand, and a healthy As the above lettings demonstrate, the
Frogmore Real Estate Partners paid £44
investment market. There has million for a mix of Industrial (1 million sq
logistics market is being propelled by
retailer and e-commerce demand. The DB SYMMETRY
been strengthening appetite in ft), Office (384,000 sq ft) and Residential. AGENCY
favourable labour supply characteristics Leasehold Disposal
the investment market in the Prime yields in Leeds remain stable at 5 in the region are proving attractive to Symmetry Park, Darlington
North East region and some per cent, with other key wider North East occupiers, with availability and cost of
Robert Whatmuff
+44 7703 393 145
sizeable deals in Yorkshire. locations up to 75 bps higher. labour being the pre-eminent consideration robert.whatmuff@colliers.com
for many occupiers.
Speculative development is starting to gather
Investment Market Occupational Market pace, particularly in South Yorkshire, although
Simon Hill
+44 7736 480 041
immediate development opportunities in West simon.hill@colliers.com
Investment volumes in the wider North East Occupational demand remains strong in Yorkshire are severely restricted.
(including Yorkshire and the Humber) will the North East and Yorkshire/Humber Demand has driven selective rental growth
be close to £500 million in 2018, a slight region, with a number of mega shed in Leeds, Sheffield and Newcastle with Henry Watson
improvement over the £479 million achieved deals boosting annual take-up. The rents for 10,000-30,000 sq ft units now in ABERDEEN STANDARD INVESTMENTS +44 7928 654 557
in 2017 (Property Data). Interestingly, aforementioned Symmetry Park, Darlington the range of £6.50-£6.75 psf. Leasehold Disposal henry.watson@colliers.com
volumes in 2018 have almost doubled in the letting of 1.5 million sq ft is by far the V415 Doncaster
North East, but have fallen by around 25 per largest leasing transaction in the region. Prime regional logistics rents (100,000+ sq
cent in Yorkshire and the Humber. It is a prime example of how technology ft) are £5.50-£5.75 psf. INVESTMENT
enables intensive use of warehousing, with Ben Hall
Tritax Big Box REIT was responsible for the
mezzanine floors maximising cubic capacity +44 7855 814 516
largest transaction in the year to date, the ben.hall@colliers.com
GLENTROOL ESTATES
Freehold Disposal
S2, Sherburn
16 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 17ASDA
Freehold Disposal
Grangemouth
The Industrial and Logistics investors can take advantage of. As a Demand continues to come from a broad
result, the sector has continued to perform spectrum of sectors. Whilst parcel delivery
market in Scotland has
well. The strongest demand favours long- firms have been a feature of market activity,
performed relatively well dated income or modern property in prime Scotland has seen lower levels of demand
over the last 12 months. That locations, with prime yields in Edinburgh from online retailers than the rest of the
said, whilst supply continues and Glasgow at 6 per cent. Older or more UK as increased e-commerce demand
to diminish and demand for secondary stock has a place in the market is served by large RDC’s in the north of For more information
as long as it is priced correctly and, England. The market continues to witness please contact:
small units remains strong,
crucially, if the lot size is large enough to tightening supply levels and, with the future
take-up of medium to larger attract the main industrial players. Investor speculative development pipeline remaining EXETER PROPERTY GROUP
sized buildings has been caution for anything other than modern and/ limited, we expect upward rental pressure Leasing AGENCY
more limited, no doubt due, or well-located stock is continuing to drive the in 2019. The Scottish Industrial and 21 Coddington Crescent, Eurocentral
in part, to the wider political prime and secondary pricing differential. Logistics property market has a total stock Iain Davidson
of 225 million sq ft. The availability rate has +44 7795 010 118
and economic uncertainty iain.davidson@colliers.com
been declining gradually to the present 8.2
surrounding Brexit. Occupational Market per cent (18.4 million sq ft), representing a
significant 32 per cent reduction from the
Colin McManus
2011 peak of 12 per cent. Only 5 per cent of
Investment Market Q1 to Q3 2018 saw Scottish Industrial take-
available stock is new or modern, which is
+44 7795 613 227
colin.mcmanus@colliers.com
up of 4.2 million sq ft. There is, therefore,
a concern for larger occupiers and unlikely
some catching up required to reach 2017’s
to be addressed by developers. We therefore
Investment volumes to the end of November total of 8.1 million sq ft or the 10-year
anticipate more built-to-suit activity. Lewis Pentland
2018 were at £310 million (Property average of 7.9 million sq ft. +44 7748 704 734
GRAYLING CAPITAL
Data), 7 per cent higher than 2017 and the lewis.pentland@colliers.com
Demand for the smaller sub-15,000 sq Acquisition
strongest year since 2014.
ft size range remains healthy, with 2018 Titan, Centralpoint, Eurocentral, Glasgow
The multi-let investment market in Scotland take-up in this size band broadly similar
continues to be favoured due to the strong to 2017 and accounting for 45 per cent of
INVESTMENT
occupational story and the low capital total take-up. However, the medium sized Patrick Ford
values per sq ft on offer. The largest non- (15,000-50,000 sq ft) end of the market +44 7811 150 378
portfolio transaction was Canmoor Asset has been more subdued, accounting for 34 patrick.ford@colliers.com
Management and JCAM’s purchase of the per cent of total take-up. Mirroring historic
45 unit, 1.6 million sq ft Westway Park, trends, the 50,000+ sq ft market is less
Renfrew for £37 million, at an initial yield of active, albeit there appears to be several Elliot Cassels
8.9 per cent. +44 7968 196 212
unsatisfied requirements which we hope elliot.cassels@colliers.com
Scotland offers a yield discount to the will translate into transactions in 2019.
rest of the UK, which income focussed CANMOOR
Leasing
Westway Park, Renfrew
18 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 19SILVERWOOD PROPERTY DEVELOPMENTS
Acquisition
Former Michelin Factory, 190 Raceview Road, Ballymena
Demand for industrial space Occupational Market demand for film studio space, very much a
derivative of the positive experience HBO
remains concentrated around
has enjoyed during the eight plus years
the Greater Belfast area of Game of Thrones being shot in Belfast.
Principal drivers of demand in 2018 were
and established provincial third party logistics operators managing Belfast Harbour delivered a bespoke
industrial parks which benefit contract led solutions for a variety of 120,000 sq ft facility, immediately taken by
from immediate accessibility business users, from e-commerce to Warner Horizon, and a number of further For more information
projects seem keen to locate in Northern please contact:
to the motorway network. The international manufacturing companies.
SCREWFIX
These demand drivers are, however, Ireland given the excellent accessibility
market is very much deterred from London and support network for the Acquisition
reflected in short term (three to five
from opportunities that do not year) contract led solutions, which are industry that now exists. Omagh & Enniskillen AGENCY & investment
exhibit this key characteristic. not sufficient to drive either new build or 2019 should see the emergence of a
speculative development. Ian Duddy
number of more significant pre-letting +44 7730 502 897
There has been no speculative development deals, with Amazon rumoured to be ian.duddy@colliers.com
Investment Market in Northern Ireland for over 10 years, albeit acquiring a dedicated distribution hub
the past 12 to 18 months has witnessed the alongside a number of other 3PLs.
There is a limited supply of institutional grade completion of a number of sizeable build- New build distribution units with 8 metre
industrial product in Northern Ireland and a to-suit pre-lets including Bunzl (Armagh) plus eaves heights located in immediate
corresponding lack of transactional activity. and Cosentino (Nutts Corner). proximity to motorway junctions will
2018 has seen a demonstrable appetite from A key characteristic of the Northern Ireland command rents in the region of £5.50-
a range of family trusts, property companies market over the past 10 years has been £6.25 per sq ft. However, a very limited
and opportunity led funds for a combination supply of this type of accommodation, ASDA
the closure of a number of large factories
of individual properties, multi-let estates and particularly in the 50,000+ sq ft size range Lease Renewal
housing major local employers. The past
built-to-suit assets. is available. Port of Larne
12 months has seen Michelin (800,000 sq
The largest industrial asset brought to the ft) close in Ballymena (acquired by Colliers Second/third generation warehousing/
market in 2018 was Antrim Business Park, International) and Schlumberger close former manufacturing space across Greater
a 580,000 sq ft former manufacturing (150,000 sq ft) in Newtownabbey. In the Belfast with eaves heights of 6 metres
facility set on 72 acres, at £12.5 million, absence of new development, demand for plus is achieving £3.75-£4.50 per sq ft,
which attracted multiple bids, all from large distribution warehouse space is being dependent upon location, configuration and
outside of Northern Ireland. The property actively absorbed by these opportunities. specification.
presents a range of asset management Outside of what would be deemed
opportunities and we understand that a sale traditional demand, Northern Ireland has
has been agreed above the asking price. witnessed a continued increase in
AGRO MERCHANTS
Acquisition
Blackstaff Road, Belfast
20 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 21Head of Industrial & Logistics South West Yorkshire & North East Investment
Len Rosso Tom Watkins Robert Whatmuff Michael Kershaw
+44 7831 436 096 +44 7917 093 167 +44 7703 393 145 +44 7834 083 126
len.rosso@colliers.com tom.watkins@colliers.com robert.whatmuff@colliers.com michael.kershaw@colliers.com
Established national team
London in key locations across
James Short Simon Hill John Hanson
+44 7720 073 227 +44 7736 480 041 +44 7825 251 894
the UK with extensive
William Bellman james.short@colliers.com simon.hill@colliers.com john.hanson@colliers.com local knowledge
+44 7881 553 904
william.bellman@colliers.com Midlands
Henry Watson Chris Bampton
James Haestier Simon Norton
+44 7928 654 557 +44 7825 603 211 Unrivalled occupier
henry.watson@colliers.com chris.bampton@colliers.com
+44 7818 038 009 +44 7788 436 273
representation
james.haestier@colliers.com simon.norton@colliers.com Scotland
Richard Coombs
+44 7795 652 030
Akhtar Alibhai Peter Monks Iain Davidson
richard.coombs@colliers.com Strong relationships with
+44 7909 684 801 +44 7766 504 989 +44 7795 010 118 key developers and funds
akhtar.alibhai@colliers.com peter.monks@colliers.com iain.davidson@colliers.com
James Preston
+44 7740 542 207
Tim Harding Richard Meering Colin McManus
james.preston@colliers.com Dedicated logistics and
+44 7860 180 328 +44 7771 633 831 +44 7795 613 227
tim.harding@colliers.com richard.meering@colliers.com colin.mcmanus@colliers.com supply chain experts
Ben Hall
+44 7855 814 516
Georgia Pirbhai Sam Robinson Lewis Pentland
ben.hall@colliers.com
+44 7599 533 143 +44 7825 437 213 +44 7748 704 734 Strong market
georgia.pirbhai@colliers.com sam.robinson@colliers.com lewis.pentland@colliers.com
Patrick Ford performance in excess
West London North West Northern Ireland +44 7811 150 378 of 20 million sq ft
patrick.ford@colliers.com transacted within the last
Patrick Rosso John Sullivan Ian Duddy 12 months
+44 7825 571 048 +44 7702 908 353 +44 7730 502 897 Elliot Cassels
patrick.rosso@colliers.com john.sullivan2@colliers.com ian.duddy@colliers.com +44 7968 196 212
elliot.cassels@colliers.com
Supply Chain Expert
Isa Naeem Nathan Khanverdi
Marketing & Communications
+44 7889 432 972 +44 7594 091 365
isa.naeem@colliers.com nathan.khanverdi@colliers.com Chris Evans
+44 7799 587 230 Hannah Morris
Business Development Research chris.evans@colliers.com +44 7548 710 021
hannah.morris@colliers.com
Jessica Rice Andrea Ferranti
+44 7881 803 547 +44 7522 357 441 Grace Azcarate
jessica.rice@colliers.com andrea.ferranti@colliers.com +44 7936 336 796
grace.azcarate@colliers.com
22 INDUSTRIAL & LOGISTICS | UK 2019 Colliers International 23All information, analysis and recommendations made for clients by Colliers International are made in good faith and represent Colliers International’s professional judgement on the basis of information obtained from the client and elsewhere during the course of the assignment. However, since the achievement of recommendations, forecasts and valuations depends on factors outside Colliers International’s control, no statement made by Colliers International may be deemed in any circumstances to be a representation, undertaking or warranty, and Colliers International cannot accept any liability should such statements prove to be inaccurate or based on incorrect premises. In particular, and without limiting the generality of the foregoing, any projections, financial and otherwise, in this report are intended only to illustrate particular points of argument and do not constitute forecasts of actual performance. Colliers International is the licensed trading name of Colliers International Property Advisers UK LLP (a limited liability partnership registered in England and Wales with registered number OC385143) and its subsidiary companies, the full list of which can be found on www.colliers.com/ ukdisclaimer. Our registered office is at 50 George Street, London W1U 7GA. This publication is the copyrighted property of Colliers International and/or its licensor(s). © 2019. All rights reserved.
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