Almost 300 professionals from across the sector took part in the 2nd industrial & logistics census this summer initiated by db symmetry, to have their say on their experiences in 2018 so far and their expectations for the next 12 months.
With more than a third of the respondents being occupiers, results show we can look forward to continued growth in our sector with;
- 54% of occupiers anticipating needing more space over the next two years
- 41% of occupiers predicting that they would require the same amount of space in the next two years, with only 5% saying they would need less
The main reason behind occupiers’ need for more space is due to continued growth in online purchases and the pace of change towards new retail channels. However, the main challenges for them is the lack of availability of warehouse space and access to labour. Lack of warehouse space is especially a concern for several occupiers looking to expand in London.
More than half (53%) of developers and landowners said they had grown their land banks in the past six months, an increase on the 47% of respondents who said the same in last year’s census. However, they are most concerned about the lack of development sites and the length of the planning process, with 80% suggesting that making the process more efficient is very important, an increase on the 77% who said this last year. The pace of change in tenant requirements is another issue for developers, with 50% stating this issue is very important.
While all respondents shared the positive occupier opinion on future demand for space over the next two years, lack of supply is a key issue amongst the whole sector, with labour issues, rising rents and an inefficient planning system also key challenges. Let’s not forget the B word – Brexit – the uncertainty of which continues to weigh heavily on occupiers’ minds.
To counter the lack of supply, developers and landowners plan to bring more speculative buildings to the market in the next 12 months. 52% said they were planning more spec developments and 41% said their spec pipeline would remain the same.
As last year, power supply to potential new schemes is a key issue, with 70% saying it is very important. With regards to technology, warehouse automation was expected to have the biggest impact on logistics, alongside predictive analysis and electric vehicles.
On the investment side, 53% of investors and asset managers believed investment levels would remain the same this year, compared with the record-breaking volumes achieved last year. 37% expect investment in the sector to increase in 2018.
Overall these findings show that developers, landowners, occupiers, agents and investors can look forward to another record-breaking 12 months ahead, which makes for a very reassuring read.
To read the article in full, click here Industrial & Logistics 2018 Census