The King Sturge latest survey of Industrial Floorspace reveals that the total level of available industrial floorspace across Great Britain at December 2001 stood at 16.417 million sq m. This was 7.8% higher than recorded in the previous survey in August and 20.9% higher than the figure in December 2000.
Available new space at December 2001 stood at 1.328 million sq. m., a rise of 21.5% since last August. There was only an additional 644,311 sq.m. under construction on a speculative basis in 82 schemes across Great Britain. However this was a fall from the autumn period when King Sturge recorded 793,177 sq.m. under construction on a speculative basis in 106 schemes.
Angus McIntosh, Head of Research at King Sturge said, â€œAlthough the level of floorspace immediately available has increased, our survey shows that there is a slowdown in new development. Analysis of our data reveals that, as at the beginning of the year, there was not a single major building under construction which will complete after the middle of this yearâ€.
David Brooks, National Head of Industrial at King Sturge said, 'Whilst enquiry levels are down from 6 months ago, the market itself continues to remain very active. In the main, those companies who were looking to move to accommodate future expansion plans, but had no pressing need to move, are not making decisions at the present time. However, the enquiries which are left in the market are from companies who have to move as they are undertaking consolidation exercises to save costs, by putting several operations together, or are taking the advantage of lease breaks or renewals to upgrade or downgrade.
â€œThe freehold market continues to perform particularly well, with both occupiers and private investors taking advantage of both low interest rates and the opportunity to set up Self Administered Pension Schemes.'
King Sturge forecast that rental values will grow in the range of 2% to 3% this year. With investment yields in the industrial investment market currently at 7.1% in London, and 8% or more in many other parts of the country, industrial property is likely to continue to perform relatively well in 2002, especially with the equity market moving sideways.
(source: King Sturge)