Gatwick Industrial Property Update: H1

Overall, we have seen a good level of demand and take-up in most areas across the South East, despite the pace of industrial activity slowing from the highs of the Covid peak.

Steve Berrett, Agency Partner based at our Crawley and Brighton offices, explores the latest industrial property trends across the Gatwick Diamond region.

Interest is still good for modern, energy efficient property with most activity in the smaller to medium sized units.  We are experiencing this is mostly led by occupiers who have lease expiry/break clauses or have outgrown their current space.

We have been advising several occupiers in their relocation as their existing accommodation is no longer ‘fit for purpose’ and that the cost of staying and refurbishing is often financially unviable.

This is more notable in the older buildings which are poorly configured or where companies are looking to improve their offices with the adjustment to agile and smart working.

Likewise larger companies are looking to rationalise their space, often moving from three or two units down to one, to reduce overheads.Interest is still very much strong for freehold opportunities largely through owner occupiers often looking to come out of leases.

Activity in the investment market still subdued mainly due to interest rate levels but also due to lack of available stock.

Take-up in the first half of 2024 was from a broad range of sizes with the majority of demand still within logistics / B8 (Storage or distribution).  However, the logistics sector slowed at end of 2023 and into the first 6 months, and this affected the number of transactions for larger sized units (50,000 sq ft +).

Rents have generally remained the same across the region and, in some areas, there has seen growth in where there is still short supply such as Brighton & Hove and along the coast areas in Sussex.

We have started to see landlord incentives increase marginally and will monitor the market as we head into H2 and potential political and economic upheaval and the unintended consequences of this on the market.

Prime industrial rents

Crawley & Gatwick

Industrial take-up in Crawley and Gatwick annually is in region of 400,000 sq ft however noting that take up for 2023 was in the regio of 700,000 sq ft. Availability currently sits at roughly 700,000 sq ft.

On the new build schemes Arrow Point is now fully let whilst The Base remains available with a total of 200,000 sq ft. At Panattoni Park on Manor Royal 200,000 sq ft is due to be built and it remains to be seen as to what the future holds for Astral Towers opposite.

Rents are at £17.50 psf here for new build in the region of £12-£13.50 psf for refurbished units.

Burgess Hill

Take-up annually averages around the 110,000 sq ft level however this is expected to increase as units are let at the new speculatively built scheme at Panattoni Park, Burgess Hill.

This provides a total area of 457,000 sq ft across 14 new units with quoting rents at £17.50 per sq ft. Given generally rents have been in region of £12 psf this will certainly raise the bar for rents in this area quite considerably.

Horsham

Despite low take-up over recent years, rents in Horsham have risen to over £14 psf, mainly due to lack of stock historically to the market.

Whilst Horsham itself is starved of new supply, nearby Billingshurst Business Park has units from 10,000 sq ft and Enterprise Park is offering units from 3,000 sq ft.  Toolstation, Howdens and Easy Bathrooms already have moved in.  At the Platts Roundabout site, Focal Point brings in 53,000 sq ft into the pipeline.

New developments from Chancerygate and Graftongate at Southwater, will deliver units totalling 200,000 sq ft of freehold and leasehold space.

Sussex Coast

Rents on the Sussex Coast have remained relatively stable owing to a lack of availability and new development.

However, Worthing has new builds under construction with 22 smaller units (850 sq ft upwards) within the Glenmore scheme freehold market. Quoting prices are understood to be in the region of £350.00 per sq ft.

In Brighton and Hove, rents are over £16 per sq ft, although rents are being quoted at £21 per sq ft for some of the smaller units (sub 5,000 sq ft) available.

Panattoni Park Brighton at Shoreham Airport is now built and is now available to occupy with 7 units starting from 19,500 sq ft, and quoting rents in the region of £18.00 per sq ft

For help and support with your industrial requirements – whether you are an occupier seeking premises, and landowner with development land to sell, or an investor wishing to acquire, our Gatwick-based agency team can help. Get in touch for more information.