Online shopping fuels new commercial property warehouse boom in the UK
A record amount of new warehouses are due to be built in Britain this year, as developers respond to rising demand for storage by on-line retailers. Knight Frank, the property consultant, found that 40 million sq ft of new warehouse space is due to be built this year double that built last year. British high street retailers, such as Arcadia and Debenhams, and many others have either collapsed, shrunk their operations or transferred the business 100% online. The ever-growing ecommerce boom has driven record demand for warehouse space across the UK, as the pandemic/economic situation forces more retailers to shut up physical stores and do business online.
UK warehouse investment hits record high as shoppers shift online
The flow of money into the UK’s retail logistics sector hit a record high last year, as investors sought to ride a boom in ecommerce and shift cash from struggling office properties and shopping centres. Large warehouses and last-mile delivery facilities have been among the winners of the pandemic, which has forced more shoppers online and led to the stockpiling of various essential goods and medicines.
The biggest single commercial deal was private equity firm Blackstone’s £473m acquisition of a logistics platform from the world’s largest warehouse company, Prologis, in October. Amazon, whose vast marketplace has allowed it to ride the 2020 e-commerce wave, signed leases on a series of multimillion-square foot facilities around England last year and many other companies are following.
It is crucial to have an up to date valuation of any commercial property so you know exactly what it is worth, also for insurance purposes - and whether it’s going to meet the needs of operating a business in the short, medium and long term.
Stuart Scotland
12/4/21
