Supply

The supply constraints within the market have alleviated in 2018 with supply rising 41.6% to reach 2.03m sq ft.

The supply is skewed towards smaller-sized units as 44% of available units are under 200,000 sq ft with no units above 400,000 sq ft. The largest unit on the market is the former Morrisons at Cribbs Causeway Distribution Centre totalling 384,786 sq ft.

62% of available space is classified as Grade A, a 32% increase on the amount of Grade A supply in 2017. However, Western 105 is the only new speculatively developed unit currently available where Richardsons and Curtis Hall developed 105,500 sq ft, the eight other units (89%) are all classed as second hand.

Take-up

Following two strong years of take-up, activity within the region has fallen to the lowest levels since 2014. Take-up reached 995,106 sq ft through five separate deals; a 50% fall from 2017 take-up and a 66% decrease below the long-term average, albeit with recent years being dominated by large deals by Lidl, The Range and Amazon.

All 2018 deals involved solely speculatively developed or build-to-suit demonstrating demand for high quality units. Indeed the two speculatively developed units let in 2018 with a void of below eight months.

The largest deal of 2018 was B&Q acquiring G Park Swindon, a build-to-suit unit totalling 375,286 sq ft.

The market was dominated by retailers who accounted for 70% of the total space leased with manufacturing and automotive making up the balance.

Development pipeline

There is a total of 416,520 sq ft being speculatively developed across three separate units. The largest unit being Access 18 where St Modwen are speculatively developing 151,330 sq ft, set to reach practical completion in Q1 2019.