The Midlands industrial market is thriving, with activity levels for smaller units (< 5,000 sq ft) absolutely red-hot. Our Director, Andrew McFarlane Holt reports…
“Competition in the industrial market has been especially fierce over the last two years and we’re not only seeing transactions occur at record pace but that they could also be completed three or four times over for the same unit. This is being driven by a serious lack of good quality available stock.
“At the smaller end of the market, where units offer potential for hybrid office/warehouse set-ups and can be found in urban locations, there is exceptional demand, so rental values remain strong. This has been accelerated by digitalisation and the influx of online retailers but also through a new generation of businesses looking to secure warehouse space or logistics centres to recycle or retrofit, for instance as bespoke gyms, micro-breweries or filming studios.
“Similarly, larger units located in strategic hubs or industrial parks remain popular and we’re just concluding a deal on a 50,000 sq ft unit in Rugby. The problem for this end of the market is a scarce supply, so more purpose-built units and speculative development is urgently required.
“Whilst we are not naïve to the potential effects of interest rate and tax rises, we are encouraged by the activity in this sector as businesses look to both up- and down-size. There maybe challenges and pain ahead, but this is unlikely to be long-term. The Midlands boasts excellent transport links and a strong labour pool, so is in a positive position and deals will continue. We encourage tenants, landlords, developers and investors to get in touch for further advice.”
