UK logistics property demand raises fear of shortfall

Logistics property take up in the Midlands is at its highest level since the downturn, with only a year’s worth of warehouse space left, according to figures released by BNP Paribas Real Estates.

There has been a 66% rise in deals done in the design and construction sector within the midlands so far this year; a key factor driving the increase in take up, with 900,000 sq ft of transactions in 2012, compared to 300,000 sq ft in 2011.

The Midlands is one of the UK's core logistics regions, accounting for 14% of available stock on the market, equating to 20.4 million sq ft.

Within the UK, logistics properties in the Midlands outperformed all other industries in 2012, making it one of the strongest regional asset types in the UK.

Aidan Baker, based within BNP Paribas Real Estate's Newcastle office, said: "The increase in take up continues to reinforce the view that the region’s multi-modal logistics capacity is having a positive effect when it comes to attracting tenants.”

There is also heavy investment from the manufacturing sector within the Midlands, meaning there are even fewer quality logistics properties on the market, according to the BNP Paribas Real Estate Logistics Index, compiled in conjunction with IPD.