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Concerns over Shortening Supply of Grade A Property Space

It has been recently reported that Grade A property supply in the North West industrial industry is to hit a rate of concerning shortage by the end of the year. Highlighted Savills, figures have shown that, although some 2.2m square feet of space is to be provided over 11 different

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BDC 318 : Jul 2024

grade a

Concerns over Shortening Supply of Grade A Property Space

It has been recently reported that Grade A property supply in the North West industrial industry is to hit a rate of concerning shortage by the end of the year. Highlighted Savills, figures have shown that, although some 2.2m square feet of space is to be provided over 11 different schemes this year, the demand and take-up of such space is at a level far outstripping that of the supply. Shockingly, the North West has actually been highlighted to represent one of the most considerable (the second most) pipelines for development in the entirety of the UK, it is still yet unable to compete with average annual take up values of approximately 3.44m square feet, leading sceptics to fret over a growing reduction in space actually available for further take up. The predicted figures effectively follow from last year’s record setting take up values, where the North West alone achieved a considerable 4.56m square feet of take up over the course of the year. And while Savills does indeed nod towards the great work being undertaken on the development front, which will no doubt provide much-needed space for further take-up, yet simultaneously Stuart Murray, Savills’ Industrial Director outlines the growing need for further development pipeline and opportunities to develop. With the market almost wholly-dependent on the provision of further stock to continue performing out of the recessionary periods, the importance of further development is absolute, with Murray commenting: “The big questions now are where will the second tranche of new stock come from and who will the developers be?” Of course, whilst there is a reportedly considerable amount of industrial stock presently available in the North West, sitting at some 5.71m, some 81% of this is regarded as Grade C or B stock, with many of the Grade C stock actually not being fit for occupation. This, of course highlights an already shortened supply of Grade A stock, with an ever-increasing reason for developers to move.

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