New research by property consultancy Lambert Smith Hampton (LSH) has revealed that investment volumes in Yorkshire's industrial property market have fallen by 18 per cent.
The report highlighted that, in the first six months of 2013, total industrial investment in Yorkshire and the north-east of England totalled £69.59 million, nearly one fifth lower than the £85 million invested during the same period in 2012. In total, the average industrial rent for prime space in Yorkshire is £5 per sq ft, while total take-up stood at 3.9 million sq ft in the first half of 2013.
LSH has suggested that the distinct lack of Grade A industrial space in the region is what has led to a major decline in take-up. Even though there is a good availability of large warehouse and logistic facilities over 100,000 sq ft, there is only less than one month's supply of smaller sheds left; properties which are usually more sought after by potential buyers.
Rob Whatmuff, director and regional head of industrial and logistics agency for the north, said: “We have reached a critical tipping point where we need new developments on site to ensure that SME and mid-box occupier demand can be met. There are several large-scale distribution units on the market, but we have little to offer those occupiers seeking any units less than 100,000 sq ft. It’s a dangerous situation as businesses that want to expand or move into Yorkshire will have no choice but to look elsewhere for existing buildings.“
It is important to note that the first half of the year did see some notable transactions, such as Tritax’s purchase of The Range in Doncaster for £37 million, Maplin Distribution Warehouse in Rotherham being acquired for £11.5 million, and Valad Europe’s purchase of the Micheldever Unit in Leeds for £5.57 million.