Supply of 2.07m sq ft is enough for just 18 months.The lack of floor space is now restricting the market so that take-up in 2015 fell 17 per cent compared to 2014.
The data, from surveyors Savills, suggests Heathrow market take-up of 1.14m sq ft in 2015.The largest deal of 2015 saw Adelie Foods take 102,900 sq ft at Prologis Park Heathrow, which was the only deal above 100,000 sq ft last year.
Bonnie Minshull, director in the South East industrial team at Savills, said: “Although there was a drop in take-up last year, we still saw significant activity in the Heathrow market. A number of speculatively developed schemes, including Prologis Park Heathrow and SEGRO’s Stockley Close, were either let or under offer within 12 months of practical completion, which reflects the strength of demand for Grade A units in prime locations.”
“Despite there being several new schemes in the pipeline, space is likely to remain constrained for the foreseeable future. If freight volumes continue to grow as forecast, our research predicts that Heathrow will need up to 14 million sq ft of extra warehouse space by 2030 to meet requirements.”
In line with high demand, prime rents have also continued to grow, rising to £16 per sq ft for space immediately south of the cargo terminal and to £13.50 per sq ft in North Feltham. Savills predicts that rents are likely to increase further still when a number of new schemes come to the market later this year, with SEGRO’s final unit at The Portal quoting £17.50 per sq ft.