Our Industrial & Logistics Insider report provides expert comment on latest occupier and investment trends, along with quarterly data and analysis.
Key findings from our Q1 2023 report indicate that:
- Take-up of industrial property over 100,000 sq ft reached 6.8m in Q1, around half the amount taken at this stage last year. This is closer to pre-pandemic norms than the records set in the last three years.
- Supply of existing units has increased to c.30m sq ft, driven in part by second-hand units returning to the market. C.4m sq ft is available by sublease.
- Logistics operators took over half of big box units, as the UK continues to adapt to supply-chain issues.
- Investment turnover remained constrained throughout Q1 following the quietest final quarter for the industrial investment market in ten years. The c.£1.0bn that transacted in Q1 2023 was approximately 80% down on the record £4.9bn that transacted in the first quarter of 2022 and less than half the ten-year Q1 average.
- However, sentiment began to improve towards the end of the quarter as some buyers sensed an attractive entry point following the correction in values in Q4 last year. This helped prime yields move in by c. 25 bps to 4.50%.
- That said, the market needs more time to adjust to higher debt costs. Upward revisions to peak interest rates forecasts, volatile fixed income yields and stubbornly-high inflation mean we are unlikely to see a noticeable uptick in volume until towards the end of the year.
Download the full report below.
