Around 2.7m sq ft of new industrial stock has completed in Shropshire & Staffordshire in the past 12 months, making it the UK’s busiest development market.
2.7 million sq ft of new industrial stock has completed in the past 12 months.
Strong demand, particularly from third-party logistics specialists and online retailers, along with growing rents have encouraged a wave of new supply in Shropshire & Staffordshire since the beginning of 2017. Much of the supply has been concentrated along M54 and M6 corridors, with the majority of the larger schemes above 200,000 sq ft situated around Cannock, Stoke-on-Trent and Lichfield.
Most of the space to deliver in the past year was developed on a build-to-suit basis. This includes DC1 unit (550,000 sq ft) and DC3 unit (213,500 sq ft) at Prologis Park in Lichfield, let to Screwfix and Anixter, respectively. Titan 640 (225,000 sq ft) in Telford was built for Magna International and a 277,000 sq ft warehouse on Campbell Road in Stoke-on-Trent was partly 50% pre-let by Michelin Europe.
But a number of notable speculative schemes have also delivered over the past year. The largest was Wolverhampton 450 (450,000 sq ft), which completed in Q4 2018. Other speculative schemes to complete were Stoke Distribution Centre (275,000 sq ft) in Stoke-on-Trent and Connecqt Alpha (154,000 sq ft) in Cannock. These deliveries have pushed vacancies upwards in the market, from 2.7% at the end of 2017 to 3.5% today.
About 60% of the newly delivered or under construction space was still available as of January 2019. However, given only two of these are under 200,000 sq ft, meaning that for occupiers with larger requirements, build-to-suit remains the only viable option. The rate of new completions is likely to slow in the near term, with only around 460,000 sq ft now under construction.