Underground mine

Could a shortage of warehouse space see occupiers dig deep?

Last year saw the industrial sector have its best year on record, predominantly as a result of the UK’s insatiable appetite for online retail. As a result, the supply of existing warehouse space has fallen by a massive 71 per cent since 2009, resulting in a significant shortage of conventional units, coupled with the limited availability of developable land earmarked for industrial use.

Occupiers are therefore now struggling to find suitable space to fulfil their last mile delivery requirements. How then will companies ensure that our parcels reach us in record time?

While some are into blue sky thinking, others are going underground. This year saw Formal Investments achieve planning consent for its 2 million sq ft (185,806 sq m) underground warehouse at Rectory Farm, moments from Heathrow airport. While not an entirely unique concept, its proximity to London would open up considerable opportunities for those looking to build up their supply chains.

Other examples have seen the use of decommissioned salt mines in Cheshire, former military bunkers in Sandwich and on a rather larger scale a 55 million sq ft (5.109667 million sq m) former mine dubbed SubTropolis in Kansas City, Missouri.

In contrast, Amazon, which accounted for just over a quarter of total industrial take-up in 2016, is looking up. The company has patented plans for a floating warehouse that would sit 45,000 feet above the surface of the earth, suspended by cables from Zeppelin-style airships. This would have the potential to dispatch thousands of drones that could deliver popular items across metropolitan areas in next to no time at all, and while this has yet to become a reality, it is certainly not beyond the realms of possibility.

Currently up to 45 per cent of logistics demand is from retailers, and as Black Friday and Cyber Monday suggest, our appetite for shopping online is unlikely to stay satisfied for long. Therefore, whether overground or underground, at least we’ll be able to rest assured that our packages are well and truly on the way.

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