The supply of UK warehousing rose sharply last year, new analysis suggests, as online shopping boomed during the Covid-19 pandemic.
Some 14.7m sq ft of new large distribution space was created last year, according to the 2021 Annual Business Rates Review from real estate adviser Altus Group. That came as 49 new large distribution warehouses of more than 85,000 sq ft – known as super sheds – were built in England and Wales, and added to the Local Ratings List, used to calculate business rates, during the 2020 calendar year.
Altus says that the same amount of space was added in warehousing as was lost through shops closing when high street retailers Debenhams and Arcadia brands, from Topshop and Miss Selfridges to Dorothy Perkins, were bought by pureplays the Boohoo Group and Asos and became online-only brands as a result.
Robert Hayton, UK president at Altus Group, says online-only retailers now account for 17% of the occupier base of the 100 biggest super sheds. He adds: “Surging demand has led to major investment opportunities, particularly for overseas investors, as the race for space continues to intensify which will undoubtedly impact tax liabilities at the next revaluation in 2023.”
Around 60% of 2020’s super sheds are located in the ‘golden triangle’ of the East Midlands, which stretches from Northamptonshire up the M1 to East Midlands Airport and west to the Tamworth area. The area saw 15 new super sheds built during the year – with floor space of 6.07m sq ft. More than a third of the East Midlands space was in Corby. That’s double the 2.77m sq ft – or 10 super sheds – built in the east of England during the year.
The West Midlands saw seven new sheds (895.5k sq ft), while the Northwest saw six (1.6m sq ft), the South East four (1.9m sq ft) and the South West two (166.6k sq ft). But no super sheds were built and came onto the Local Rating lists in either the North East or Wales during 2020.
By the end of the year, super sheds occupied 416.28m sq ft in England and Wales.