Simon Gorst, Partner at Ingleton Wood LLP, recently featured in Property Week commenting on the supply and demand for industrial and logistics warehousing space in Essex and the East of England. In our latest Ingleton Wood blog, he explores the opportunities available in a little more detail (Read the full Property Week article here: https://www.propertyweek.com/markets/demand-for-grade-a-industrial-and-logistics-space-in-essex-is-on-the-up/5096866.article).
Most regions have experienced strong demand for warehousing with a shortage of supply. This is predominately driven by online retail growth, as well as small business and trade counter expansion.
Availability of the existing warehouse stock in Essex has been declining for the last 7 years, with low levels of new space under construction. A number of schemes to provide Grade A were constructed in 2016 and 2017 such as our project for Snowbird at Hainault Works as well as developments in Chelmsford, Basildon and Thurrock.
In terms of the lesser standard industrial stock, there is a significant proportion with fibre cement cladding with minimal insulation that needs updating to meet the requirements of modern occupiers as well as the Minimum Energy Efficiency Standards (MEES). It’s thought that 15% of warehousing will be impacted by this newly enforceable MEES legislation, where commercial properties lower than an EPC rating of F or G can no longer be subject to a new letting or lease renewal.
Current high demand for Grade A space in Essex shows confidence in the region but an imbalance that needs to be addressed by further warehouse construction. The creation and expansion of transport hubs will only increase this confidence and demand.
There are obstacles to warehouse developments, such as land values and competition from other land uses such as residential. However, there are opportunities in Essex for more efficient use of space and redevelopment in existing commercial zones as well as larger development sites available at London Gateway, Southend Airport and the industrial areas of Chelmsford, Colchester and Basildon.
At Ingleton Wood, we find that careful planning is needed in the early stages of any project to ensure that the new build or refurbishment project meets the aim of the eventual occupiers. What we are finding is that warehouse refurbishment and new build specifications must be flexible. There is no fundamental shift in base build towards new technology, but you do need to be able to account for larger electrical incoming, increased floor loads and energy efficiency provisions.
Our commercial teams have a strong background in the industrial and logistics sector, providing professional and project consultancy. We regularly act on existing buildings by providing pre-acquisition advice and dilapidations services, as well as refurbishment contract administration. In terms of new developments, we have expertise providing planning, architectural, structural and project management services from inception through to completion.
Contact our commercial teams to discuss in more detail and see if we can assist with your industrial sector portfolio at firstname.lastname@example.org.