In recent years the warehouse sector has seen a seismic shift in both the level of demand, and the types of businesses that are looking to increase their warehouse portfolios. Previously, industrial sites were almost exclusively used for manufacturing purposes, whereas nowadays the need for storage space means e-commerce retailers also require warehouse properties.

This competition is quickly leading to a shortage of suitable premises, and as each sector grows, the availability of warehouse stock is sure to become even more limited.

Manufacturing Renaissance

Although the perception of British manufacturing is that it's an industry in decline, the opposite is actually true. Manufacturing still employs 2.7 million people, and in the past year the UK has moved from 9th to 8th position in the World's leading manufacturing nations.

Brexit has caused the pound to weaken, which is great news for British exporters, with manufacturing orders at their highest level since 1988. This has generated an increase in demand for warehouse properties and industrial sites, especially in the East and West Midlands - regions that have the largest manufacturing output in the UK.

E-Commerce Growth

The rise of online shopping has led to a decline in demand for physical retail premises, but a huge rise in the need for storage space in all areas of the UK. Britain has the third largest e-commerce market in the World, and big-name online stores have been quick to acquire warehouse sites to ensure their businesses can fulfill orders quickly.

In 2016, e-commerce sales grew by 17.8% and in the past year Amazon have continued to dominate the warehouse market, adding 4 million square feet of space to its portfolio in 2017. With rival online retailers also needing storage sites, expect interest to increase further throughout 2018 and beyond.

Warehouse Stock

As both manufacturing and e-commerce businesses fight for industrial premises, the construction of new warehouses simply cannot keep up with demand. There have even been suggestions that retail parks may have to be converted to warehouses to ensure that availability remains.

Another important question to consider is how can small and medium enterprises realistically compete with bigger companies who have more financial muscle? At Pall Mall Estates, we believe the solution is to act quickly and search for sites that fall under the radar of the industry leaders.

We have over 5 million square feet of property under our ownership or management, which ensures that we can always source a suitable location for our clients - many of our premises are located in key industrial locations including the Midlands, the South East, and the South West of England.

Our portfolio also includes some warehouses that the big players may regard as too small for their needs but have ample room for small or medium sized businesses. Be sure to contact us soon with your property requirements.

— Pall Mall Estates have a wide range of low cost commercial properties across the UK.

Take a look at our available spaces here or get in touch with our experienced team here.

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