East Midlands

19 July 2017, by Charles Spicer

The fact that the East Midlands is well supplied with units across size ranges will put the market in good stead to capture more footloose requirements

 

 

 
DVP118: Let to modular house builder Top Hat industries

▲ DVP118: Let to modular house builder Top Hat industries

Supply

■ There is currently 4.5m sq ft available across 18 existing units, supply has remained relatively stable with just a 6% increase from 2016.

■ The space available in the East Midlands is good quality with 3.7m sq ft of the available space classified as grade A, although some of this will be second hand. There are six units, which have been speculatively developed, available. All of these achieved practical completion in 2016.

■ There is a good choice of units available in each size band which is unlike most regions where there are lack of units available over 200,000 sq ft. There are five units available above 300,000 sq ft, the largest being Tectonic 500 which comprises 499,951 sq ft.

FIGURE 6

Supply by size

 
Figure 6

Source: Savills Research

Take-up

■ The East Midlands region has witnessed a relatively quiet year for transactional activity as take-up totals just 1.1 million sq ft. This is 66% below H1 16 and a 42% decrease from the long term average. We are aware of a number of units that are close to going under offer and some large scale occupiers seeking space before the end of 2017.

■ There were seven deals recorded in H1 2017 of which 71% were classified as grade A units. The largest unit transacted was a build-to-suit at Brackmills, Northampton where First Industrial is building a 256,029 sq ft unit for Stanley Black & Decker. Apart from this deal, all the other transactions in H1 2017 were between 100,000-200,000 sq ft.

■ Despite the strong speculative development in the region, there was only one speculative unit let in H1 2017 which was DVP 118 near Derby where TopHat, a modular housing manufacturer and developer, leased 118,000 sq ft. The manufacturing and automotive sector has been the driver of demand accounting for 75% of the units transacted.

FIGURE 7

East Midlands take-up

 
Figure 7

Source: Savills Research

Development Pipeline

■ There are five units under construction in the region totalling 812,094 sq ft, the largest being Nickel 28 in South Normanton where Thorngrove is speculatively developing 261,000 sq ft, anticipated practical completion is Q3 2018.

FIGURE 8

Development pipeline by size

 
Figure 8

Source: Savills Research

TABLE 2

Key stats

 
Table 2

 

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Key Contacts

Charles Spicer

Charles Spicer

Director
Industrial & Logistics

Savills Birmingham

+44 (0) 121 634 8407

 

Kevin Mofid

Kevin Mofid

Director
Commercial Research

Savills Margaret Street

 

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