Skip to main content Skip to footer

Industrial Implications of London Heathrow Expansion

“Industrial land values and rents are already at record highs around Heathrow, reaching well in excess of £3.5 million per sq ft and £16 per sq ft, respectively. The positive outcome from Monday’s vote on a third runway has removed any uncertainty regarding development and it is likely to help propel demand and rents to even more stratospheric levels as occupiers adapt to the increased traffic flowing through the airport. While this is fantastic news for our economy, both in West London and the UK as a whole, I have deep concerns that the industrial sector will quickly find itself incredibly challenged by the severe lack of suitable land around the airport and the dearth of speculative space in the development pipeline. 

“In the face of increased demand, landlords may look at the possibility of two storey warehouse units again, but the industry was slow to take to SEGRO’s X2. Another possibility is creating warehouse space underground, such as what is being planned at Rectory Park in Hounslow, but the costs are significant and the market appetite for this type of space hasn’t yet been tested.  

“We need to find a way to ease the development pipeline pressures and I urge local councils and planners to work closely with our industry to deliver a smart and strategic industrial development plan around Heathrow. Not least, a reassessment of the considerable amount of green belt land around the airport that is under council jurisdiction, which has strong potential to be converted for industrial use.”

Related Experts

Len Rosso

Head of Industrial and Logistics

Industrial and Logistics

London - West End

Len has more than 30 years' experience in the commercial property sector. Having started out as a trainee surveyor in 1983 he moved on to set up Jansons in 1990, a niche agency specialising in industrial in North and West London. In 2004/5 the business was voted Industrial Agency of the Year, this being the first ever non West End national practice to have won this prestigious award. In that same year the business transacted in excess of 3.5 million sq ft which accounted for in excess of 50% of the total transactions for the North and West London market.

Since joining Colliers International, as the Head of the UK Logistics and Industrial Department, the objectives are the same as always, to outperform all competitors whilst providing the highest level of service to all our clients. In 2018, the Colliers International UK Industrial & Logistics team completed over 250 deals totalling over 15 million sq ft. 

View expert