Market Insight

Out of Space?

October 13, 2020

Following the 2008 recession, demand for industrial warehouse units across the UK waned and investors and developers moved away from speculative into build-to-suit (BTS) industrial schemes.

The net result was a reduction in availability of good quality stock for many years, which is now being exacerbated by the current pandemic. 

As we navigate the unsteady waters of the COVID-19 recession, we are seeing a surge in demand for industrial space, driven primarily by the e-commerce sector which has boomed in recent months. 

Over 50% of transactions in 2020 have been built-to-suit solutions with logistics companies snapping up much of the market’s existing supply, as the likes of Amazon account for almost a third of total take up in 2020. 

This is leaving many manufacturers struggling to grow their property footprints to respond quickly enough to their changing needs.  

Many manufacturing businesses own the freehold where they are located and have extended their premises over the years, slowly adding and amending accommodation as the business has grown or contracted. 

Restricted by their freehold and the legacy of their existing buildings which often cannot evolve at the same pace as the business itself, a relocation to a new site with capacity for the future can be the answer.   

From the day that a manufacturing business decides to make a move to new premises, it can take a minimum of two years to find an appropriate property solution – be it redevelopment of existing premises, or the freehold acquisition of a site on which to construct a new building. 

The process is long-winded – one which needs significant consideration, from carrying out a site search and acquiring the land, to building the facility and slowly making the move to enable you to build up stock.   

That’s why having a five-year property plan is so important. 

Not only will it ensure that your business can respond as quickly as possible to your changing property needs, it will also enable you to plan effectively for future growth, no matter how scarce land supply is. 

As part of your plan, you will need to consider what the future looks like for your business, so you can anticipate future space needs. 

But how will you know what ‘good’ space looks like? How will you know what opportunities exist, what will it cost you and how long will it take? 

To answer these questions, it’s important to seek professional advice from property experts who know the manufacturing sector inside out and who can manage the process with you, from start to finish. 

That’s exactly what our project management team does. 

We get underneath the skin of your business, spending time with you to understand your operations and what does and doesn’t work, so that we can craft a solution to meet your future needs. 

By spending time on site with you and your managers, we will work out how much space you have, what is over or under-utilised and where production flow does and importantly does not work.  

Taking this information, we produce a space budget to establish what your future property model needs to look like.

Unless your business is changing dramatically and quickly, it will invariably be better to invest in the freehold acquisition of space. 

In the majority of cases, this will mean the development of new, more efficient, space as we help to create a more cost-effective, bespoke property solution which will add value to your business in the long term. 

Drawing on the expertise of our various teams, we can manage the relocation process – from searching for and acquiring new sites or buildings, legacy site value maximisation and disposal, to planning, design, project management of the development and delivery of your new premises. 

Our business space team will carry out a site search, our business rates experts will explore the rating impact of a move, and we can manage the project deliver throughout – from initial concept, through design and construction, into occupation. 

So, if you are out of space, want to consolidate your business or simply need to relocate to new or larger premises, our team can help deliver a bespoke end-to-end property solution – leaving you to focus on your core business. 

Find out more about our services, or contact a member of the project team to discuss your individual needs.