Supply

The supply of warehouse space in Scotland for units larger than 100,000 sq ft has fallen by 14% since 2018 year end and now stands at 1.48 million sq ft across ten separate units. The supply at present is skewed towards smaller, second hand units with 90% of the available units on the market being within the 100,000-200,000 sq ft size category, just 11% of the total available space is of grade A quality.

Evidently there is both a supply shortage in size and quality of available units in the region, with the vacancy rate hitting the lowest level ever recorded at 5.55%. The largest unit on the market is Lidl’s Regional Distribution Centre at Deans Industrial Estate comprising 291,710 sq ft following the forthcoming relocation to their new 750,000 sq ft base in Eurocentral.

Take-up

Take-up in Scotland in H1 2019 reached 360,966 sq ft through two separate transactions, representing a 180% increase on the full year figure for 2018. Take-up has primarily consisted of second hand units accounting for 67% of all space transacted yet there has been a recent influx in the proportion of build-to-suit space totalling 33% of all space transacted in 2019 YTD.

As predicted, it seems that take-up has perhaps been constrained by occupiers seeking required features which existing lower quality buildings cannot provide and are thus exploring the build-to-suit option.

The largest deal in H1 2019 was Malcolm Logistics acquiring 240,966 sq ft at 16 Blackburn Road in Bathgate, Savills acted on behalf of the vendor.

Development pipeline

Following on from last year, there are still no units being speculatively developed over 100,000 sq ft in Scotland meaning we do not expect vacancy rates to fluctuate in the medium term.

_{Read the articles within Big Shed Briefing below.}