Supply

The supply of warehouse space has decreased dramatically in the last 12 months to stand at 2.7m sq ft across 14 separate units. Using the three-year average annual take-up of 4.56m sq ft, this equates to just 0.59 years’ worth of supply in the region.

Grade A stock now accounts for 36% of all available space, of which 17% has been speculatively developed. In terms of unit count, the supply is skewed towards the smaller size bands, 64% are between 100,000–200,000 sq ft band, 21% within the 200,000–300,000 sq ft range and 7.5% within the 300,000–400,000 sq ft and 400,000–500,000 sq ft size bands. The largest available unit is Matrix 420 in Chorley, comprising 421,810 sq ft of Grade A second-hand space.

Savills is aware that 36% of the current available space is under offer and due to exchange in Q3 2021 – this would drop the vacancy rate further to 2.12%.

Take-up

Take-up in H1 2021 has surpassed expectations reaching 3.58m sq ft across 18 separate transactions. It’s the best H1 we have ever recorded, 89% above the long-term average.

In terms of Grade, 60% of space transacted in 2021 has been Grade A, 27% Grade B, and the remaining Grade C.

As Covid-19 has delayed construction times, we have seen an increase in take-up of second-hand space in the region to satisfy immediate requirements. 2021 has seen 45% of space transacted being second-hand, 28% being built-to-suit, with the remainder being speculatively developed space. Occupier demand has centred on smaller sized units; the average deal size in 2021 currently stands at 198,822 sq ft.

We continue to see strong levels of activity from a variety of different occupier types in the North West, which continues to demonstrate the strength of the market. The largest deal this year has been Amazon committing to a 650,000 sq ft unit in Knowsley.

Development pipeline

There are currently 10 units being developed, totalling 2.12m sq ft. Six are in the 100,000–200,000 sq ft size band, two in the 200,000–300,000 sq ft size band, and two within the 300,000–400,000 sq ft size band.

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