The CBRE Intelligent Investment UK Logistics Q3 2023 Market Summary reports that UK logistics take-up in Q3 2023 was 13.3 million square feet, representing a 56% decrease compared to the same period in 2022. Take-up in Q3 was stable at 3.3 million square feet. Logistics companies are holding off on expansion plans due to continued uncertainty in the economy and declining retail sales. Construction has decreased as supply responds to the slowdown in demand, with new completed space and second-hand available space increasing compared to the end of Q2. The East Midlands continued to have the largest share of logistics take-up, accounting for almost half of the total. The UK Logistics availability Q3 2023 by region was 16.8%. The report also highlights that the UK Logistics take-up share was 16.8% and the UK Logistics availability was 14.6%.
CBRE RESEARCHOCTOBER 2023
MARKET SUMMARY
Highlights
–Ta <α-up during the firs. nin rncr ths of 2023 tot=llec 13.3n aq ft. repr 82enting a 56% decr aaseccTpared to the same period in 2o22 Take-up in Q3 wias stab e QoO at 3.3m sg ft Lcgisticsc.cupiars are acill hcldi ng off on ax pansicn plans due ta the nontinued general unce'ta nty. wit-inte'est rates ow weighin heavily an tFe economy and patentislly leopsrcising retail sales
–Available spacc l ihc onc f Q3 climood to 36.3rm sy fL whilsl Lho spoculaLivu spacu uncloccnstruction kept decreasing as supply respunds to the s uwdown in cel nd, ngw coripletedspace a nd secondhanc available space inc reased ccnpared to the end of Q2
–The East Midlands ccrtinued to ccnaencra tr largest share of : ke- Jp (alincst half af thetota L.k take-u> in X3 and :J2.5%, n s 17-mr>nth rolling hasis)
UK Logistics take-up shareby region, 12 manths toend 3 2023
ku. CoP U while mr are thn two th rclsfcr Llo YT lo 229,692 sc f almosl 100.000 sg T lcss Ian thc volaa uoel siz wus in 2020
–Dn a 12-rnorth roling basis, third- arty logist'cs cccupiers (aP_s) continuaci to be the sectc*expandi ng the most with 38% of the tctal take-up. fcllowec by omnichannel retailers clss) andmsnufsstu'ers (14%). Cespite closinc deals on all sizeb: nds, 3FLs shcwed a praference fcr smallerunts which alins wrth the cenersl :rerd, vnile re:s ilers focused on lsrcer units thst csn al space, and tl completian of a recorc: 5.7m 5q ft cf specu #tive.clvel>aments: d.5im sn ff of which direc:ly added tc t ne vacancy
–Spacc unclol onslruc Lior nlinued ils closccrl fnom thc 1ccoic lovuls ston al ihe cid o[2cz2The bui d-to-suit pipeline hss decressec 4os s'nce che end of st year ancd the specullative hasdecreased 33. There viere fevier nev: orojects com Tencing construction in Q3 2023
–Prime rens ncraesec QoQ in che Ncrth west, west Mic:lancs and tne South East, althouch theannualised crowth rae3 9'e narms lising fram the psndemi: year3
South East
–Tvo big bcx deals coiloletod in the South 三ast cluririg Q3, tuta lirrg .24rn sy ft a"dbringing t ne YTD tig ure just a bcve 2.5m sg tt. with a tew notable exceptions. most ctthe sig box leasing activity in the Sc.t East during 2023 cccL rred in moreaffordable areas, distancec from the M25. Hrveve, msny urhan deals were recordedin he suo-1oo.ooo sc 't ssment, whce lasirs activity is more rosilient, 2.im s ftwas under cffer at the and of the q.larter
–Available space remai ned sta ble atter che ises seen in H1. Availabilisy ir-creased 38%since the end cf 2022, primarily driven by new specu lstive stack, but alsn clue tc thereturn to t he market of seconclhg ad units now totalling almrst 7m sg ft. Thespccu lali vo p pelinc na decroesec Lo 1.im sq fl, tho lowcst fig uro inco 2021
–The South East prirng big box rant incrgased 27.s psf. Tn8 prillle yielcl 'or thereg'on stayed at 5.25%
South CastPrime Big Box RertM25 Wnal Ares.f27.50per sq 't za
Soutn CastFrime Big Box Cquivalent YieldM25 s. ffs95.25%NY
ku. CoP U