In terms of sq. ft, Savills notes that there has been a decline of 12%, however, when looking at deal counts, the region is performing 25% ahead of last year. Savills research points to a continuation in occupier activity, but with a preference towards smaller unit sizes, suggesting higher deal churn yet occupier preference.

By unit count, there have been eight transactions within the 100,000-200,000 sq. ft size band and two within the 200,000-300,000 sq. ft size band. Savills advised on three of these big box deals including K161 @ Konect62 in Knottingley, a food production unit in Leeming Bar, and Unit 5 Velocity Point in Leeds.

Of the 8.42m sq. ft space on the market, 52% is classified as Grade A, 24% as Grade B, and 24% as Grade C. There is now a single unit under construction in the wider region totalling 145,476 sq. ft as developers pause consented developments. This will keep the vacancy rate lower as supply is absorbed. The firm highlights that whilst supply has increased, a large proportion of these are unsuitable for many occupier’s requirements, particularly surrounding ESG credentials. Savills expects, with continuing issues surrounding BTS developments and their viability, many recent requirements will filter towards existing larger stock which will cause the vacancy rate to fall. This will keep the vacancy rate under 12%, a pivotal point needed for rental growth.

Tom Asher, director, industrial and logistics, Savills Leeds, comments: “The supply level in Yorkshire is increasingly dynamic, with some micro-locations experiencing oversupply while others face undersupply. Currently, the West Yorkshire market appears to be undersupplied compared to the South Yorkshire market. Developers should consider micro-market dynamics to realise rental growth potential.”

UK take-up of industrial & logistics space (units of 100,000 sq. ft+) reached 16.82 million sq. ft in the first half of 2024, a 44% increase when compared with H1 2023 and 13% above the long-term average. This can be attributed to improved market sentiment in light of a more positive economic outlook.