Market snapshot

Take-up has fallen, while rents remain steady

  • Take-up fell to 4.5m sq ft in 2012 as the lack of suitable buildings impacted on activity.
  • The most significant downturn was in second hand space where activity was down by 44%.
  • Average prime rents in Greater London grew by 1.2% over 2012, with the main growth being seen in Park Royal and Enfield. Outside of these locations rental values stabilised.

Falling availability

  • Availability fell for the third successive year, falling by 8.5% to 21.7m sq ft. Grade A space has edged upwards slightly to 3.9m sq ft, accounting for 18% of overall stock on the market.
  • The availability rate in Greater London fell to 8.1% from 8.8% in the previous year. Most markets saw a fall in the levels of availability, although Heathrow and Park Royal saw the largest falls in supply.

Key deals by size

Focus on Heathrow

  • Another year of no speculative development has seen a good level of modern unit take up in Heathrow. SEGRO had a successful 2012, disposing of almost 92,000 sq ft at X2 – the UK’s first and only purpose built two storey distribution unit.
  • Westgate Handling Services Ltd acquired 27,452 sq ft (Unit 7) at a headline rent of £6.95 per sq ft.
  • Meanwhile, Freightnet Handling Ltd acquired 64,037 sq ft (Units 5 and 6) at a rent from £6.95 per sq ft rising to c. £8.50 per sq ft. Unit 8, 33,916 sq ft, is the only unit remaining, at a quoting rent of £8.85 per sq ft.
  • Average prime rents in Greater London have witnessed an increase of 1.2% over 2012. Heathrow, however, has remained consistent with 2011 and prime rent have remained at £15 per sq ft. Secondary rents are currently £12.00 per sq ft.
  • The availability rate in Heathrow has also seen a reduction over the past 12 months down from 12.5 % in 2011 to 9.2% in 2012.

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Mark Gill

01727 896 232

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Mark Gill
Head of Office - St Albans

01727 896 232

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