The total take-up of UK warehouse space exceeded 6.99m sq ft in the first quarter of 2016, up 16% up on the last quarter of 2015, and 24% of the long-term average.
Research from Savills shows that take-up has been driven by a number of significant mega-shed deals. Savills recorded four deals totalling more than 500,000 sq ft (46,451 sq m) in the first quarter of the year, in contrast to only eight of these large deals taking place throughout 2015.
Richard Sullivan, national head of industrial and logistics at Savills, said: “There continues to be a number of unfulfilled requirements in the market and for this reason, we anticipate that take-up will remain strong as 2016 continues.”
Savills research confirms that the South West had its best quarter ever, transacting over 2.15 million sq ft (199,741 sq m), which is equal to 2014 and 2015 figures combined. One of the largest local deals for the region in Q1 2016 saw The Range take a 1.158 million sq ft (107,651 sq m) facility in Bristol.
Savills also notes that 57% of the space transacted in Q1 was for build-to-suit units, against the long term average of 29%. This is due to a lack of good quality stock and the limited supply of modern and fit-for-purpose warehouse space available across the UK.