According to Savills latest Big Shed Briefing, in the North West, demand is set to outstrip supply with low levels of good quality space, with the three year average annual take-up of 6.61m sq ft, this equates to just 0.51 years’ worth of supply.
The report states that there is low levels of good quality supply, with data showing that only 17 per cent of the available space is Grade A, with 51 per cent being Grade B and 32 per cent Grade C, meaning we are continuing to see occupiers gravitate to better quality space, due to efficiencies, ESG and staff retention.
Take up was only marginally down on the previous year, in spite of major headwinds, with Savills reporting that take-up was 68 per cent above long term average with the average deal size at 294,191 sq ft. Grocery retailers accounted for 27 per cent of take-up in 2022, alongside online retailers and automotive manufacturers.
One of the regions success stories has been the CDP/Mirastar development at Gorsey Point in in Widnes, which saw over 650,000 sq ft let prior to practical completion.
There are currently seven units being speculatively developed, totalling 2.23m sq ft with one over 500,000 sq ft, showing that supply is coming but not at a fast enough rate. 1m sq ft of the 2.23m sq ft has already been let prior to completion.
Jonathan Atherton, industrial and logistics director at Savills Manchester, comments: “Take-up in the North West reached 7.06m sq ft in 2022 through 24 transactions. We’re continuing to track enquiries from multiple parties on good quality prime stock, with 50 per cent of the development pipeline already under offer and due to exchange in the first quarter of this year. This increased competition has caused net effective rents to increase and with the lack of the new supply coming forward we fully expect this trend to continue.”
