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Industrial real estate supply at a ‘critical level’ in the North West

28 03 22 Industrial real estate supply at a critical level in the North West hero

Commercial real estate firm publishes its latest Industrial and Logistics Viewpoint.

Latest research reveals that Industrial and Logistics supply in the North West region is at a very critical level with only 1.7 million sq ft available of units sized 100,000 sq ft + left. However as of the end of 2021, nearly half of this space was either under offer or due to complete in Q1 2022. 

According to commercial real estate firm Colliers’ latest Industrial & Logistics Viewpoint report, only three Grade A units are currently available and one of these units is Super W in Warrington (245,000 sq ft) developed by Tungsten/British Airway Pension Fund, which Colliers is marketing. In terms of new availability, the firm’s records show that circa 3.8 million sq ft was under construction and marketed for completion in 2022.

John Sullivan, Director and Head of Industrial and Logistics North West at Colliers commented: “This high level of demand, in a depleted supply environment has caused strong rental growth with annual prime average rental growth reaching 11.2 per cent in January 2022. In 2023, we will see more rental growth with developers likely to guide between £8 per sq ft and £8.25 per sq ft for the best products (100,000 sq ft-plus ) around Manchester and Warrington.”

Occupier demand for distribution warehouses of 100,000+ sq ft remained very strong in the North West and reached 5.9 million sq ft in 2021, just slightly lower than the record 6 million sq ft recorded in 2020 and 42 per cent ahead of the five-year annual average. 

When analysing take-up by unit type, the region saw 65.3 per cent of take-up on new units (40.1 per cent for speculatively developed units and 25.1 per cent for purpose build units), and 34.8 per cent for second-hand units.

The report explains that Amazon was very acquisitive and agreed several lettings in the North West region, 650,000 sq ft at K800 site in Knowsley; 216,000 sq ft at Kinsway216 in Rochdale; Unit 2 & 3 Mountpark Omega Mountpark (203,000 sq ft and 225,000 sq ft); Venus 217, in Knowsley and Unit
F2G Multiply Logistics North (149,000 sq ft). Elsewhere, agreed the pre-let of Crewe 305 (305,000 sq ft) at Panattoni Park Crewe and UPS took the newly developed 280,700 sq ft warehouse at Panattoni Park, Bolton.

Industrial investment in the North West region broke the one billion pound mark for the first time in history in 2021  and settled at near £1.1 billion. This record activity was 26.6 per cent  higher year-on-year and accounted for 27.2 per cent of total investment volumes across sectors. 

Chris Ward from National Capital Markets North West said: “Like in many major regional markets in the UK, pricing for industrial assets has sharpened particularly for long income/single let-opportunities. Prime yields in key North West distribution hubs such as Warrington, Manchester and its surrounding towns have for the first time compressed below 4 per cent for 10-year and long income opportunities. An example of this includes NFU Mutual’s acquisition of the 216,000 sq ft Kingsway 216 warehouse let to Amazon (10-year lease) in Rochdale for £32.6 million at a net initial yield  of 3.74 per cent. Looking forward, we envisage pricing to remain keen with strong investor appetite for well-located and well-let properties to continue unabated.”

Andrea Ferranti, Head of Industrial and Logistics Research at Colliers added: “The performance of the UK industrial market is breaking records and investors are betting on the long-term performance of the sector. Prime warehouse rents will rise by 12.5 per cent in 2022 and 8.5 per cent in 2023. We predict that increasing rents, land values, construction costs, logistics and labour costs will not dissipate in 2022 and that occupiers will need to act quick to secure a deal. We expect there will be more bidding at uncomfortable levels and purchasers might need to consider speculative funding to seek higher returns due to yields being at historic lows.

“The warehouse of the future will require more highly skilled people, a robust power supply, a good pool of labour and also Grade A workspace to not only attract and retain talent but also investors. More ESG regulations will also be introduced which will further affect the sector from a cost perspective as investors seek to purchase net-zero properties and occupiers are required to adopt more sustainable technologies.”

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Related Experts

Andrea Ferranti

Director for Industrial Client Engagement

Research and Forecasting

London - West End

Head of Industrial & Logistics Research working closely with the Research & Forecasting team whilst supporting the Industrial and Logistics teams nationally in providing research and advises to clients. Andrea leads on the division’s key research papers which include, but not limited to, the Industrial & Logistics Barometer and the UK Speculative Development Map – both of which have become key benchmark publications highly valued by UK investors and developers alike.

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John Sullivan


Industrial and Logistics


I joined Colliers International UK in Sept 2016 as a Director to head up the Manchester, Industrial & Logistics team, which consists of 4 people coverging the whole of the North West.

I became chartered in Dec 2004 and have of over 17 years experience in the Industrial Agency market and previously worked in the industrial agency teams of Matthews & Goodman,  Knight Frank and Lambert Smith Hampton (Where I was head of department from 2014 - 2016) in their Manchester Offices.

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Chris Ward

Associate Director

National Capital Markets


Chris joined Colliers International in 2011 after graduating form Salford University with a Masters in Real Estate & Property Management.

Chris worked within the Commercial Lease Consultancy, and Valuation departments prior to joining the National Investment department in January 2015 where he advises clients on the acquisition and disposal of investment property across a number of sectors.

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Hannah Zitren

Associate Director

Marketing & Communications


I am responsible for media relations and generating coverage in top tier broadcast and print media. I work across a range of Colliers’ UK & Pan-EMEA business lines advising on their strategic and tactical PR needs.

My role includes:

·         Developing and executing PR plans for the various business lines to help promote their key messages across all aspects of the media - print, broadcast and social.

·          Media evaluation and reporting objectives, targets and successes across the business.

·         Reputation management and crisis management.

·         Media training.

·         Media engagement: setting up meetings with top tier media and various internal spokespeople to continuously expand and build a presence with property and vertical media network.

·         Consistently delivering service excellence, meeting with business heads of a regular basis and trying to influence the research as much as possible to ensure our content has a strong enough news hook.

·         Key campaigns that I work on include MIPIM; MAPIC; REVO; Midsummer Retail Report; IHIF; Cities of Influence in addition to a host of all alternative property sector research reports.

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