Cushman & Wakefield RETHINKING: The Shape Of Real Estate 2040

The combined outlook amounts to a 16.0% increase in requirements for space by 2040, equating to 581.3 million sq ft of additional logistics and industrial space across the UK. The supply response is likely to be slower, and will be determined by planning constraints, suitable development land and competitive pressure from other sectors. New supply in the South East will be challenging, necessitating the co-placement of logistics and industrial space alongside other use types and in “awkward” spaces, primarily owed to fierce competition from other sectors and high land values. As such, the bulk of growth will lean towards regions with a higher abundance of brownfield or permitted development land, where land values lower the viability hurdle for developers. Additionally, areas with a legacy in high value manufacturing outputs will likely be the focus of renewed UK manufacturing, for example in Ellesmere Port, Luton, Sunderland and Solihull. to meeting and surpassing ESG targets – a key component of which relies on having energy efficient buildings. Repurposing can offer a strong route to minimising carbon in development, while new supply can be built to a net-zero standard with relative ease compared to other sectors. Owed to its input intensive nature, the logistics and industrial sector is particularly sensitive

Large businesses looking to implement and meet ESG criteria are expected to continue to drive demand for this new and retrofitted sustainable industrial stock.

RETHINKING: THE SHAPE OF REAL ESTATE IN THE UK

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CUSHMAN & WAKEFIELD