Super W Tungsten p.Tungsten

Tungsten's sale of the 246,000 sq ft Super W to Leftfield for £32m was one of the larger deals of the year so far. Credit: via Tungsten

Nearly £1bn North West industrial investments reported this year

The first half of the year saw around £979m of industrial investment transactions in the North West, up from £505m the year before, according to B8 Real Estates’ regional industrial market report.

Meanwhile, the big box occupation market slowed for the first time in four years, with only 1.5m sq ft taken up – down 64% from the year before.

Here’s a closer look at each of the industrial markets. You can download the report for yourself on B8RE’s website.


While £979m of investments is a grand figure, B8RE warned that it was skewed by a few big deals – namely Blackstone’s £480m acquisition of Harbert Management Corporation’s portfolio at Trafford Park and Heywood Distribution Park.

So while there was £979m reported for the first half of 2023, it was worth noting that was only spread across 29 deals. For comparison, the same period in 2022 had £505m of transactions across 39 deals.

When looking at the B8RE data, it is clear that bigger ticket items were in demand with multi-let estates accounting for half of the total industrial sales value for the period. Smaller warehouses represented 32% of that value figure.

“Investors’ demand for industrial property has remained robust compared to other property sectors but the supply of properties remains restricted,” said John Burrows, investment surveyor at B8RE.

“Many owners are unwilling to sell in the current market and there remains a strong impasse between vendors’ and buyers’ price expectations,” he continued.

“Meanwhile purchasers are being more selective as stubborn inflation and uncertainty about when interest rates will peak has made them more cautious,” Burrows said.

“It is also harder for them to deploy capital as higher finance costs make it ever more difficult to achieve the desired returns at current prices.”


B8RE reported 1.5m sq ft taken up in the big box sector over the course of nine transactions. This is down 64% from the same period last year and is the first slowdown in four years, according to B8RE.

The agency argued that this number was due to change, with several largescale deals in the works.

A similar report from Savills was more positive. Savills’ Big Shed Briefing put the North West take-up of industrial and logistics space at 2.15m sq ft.

B8RE noted that there were only three new-build, big box, speculative units immediately available in the North West, equating to 703,000 sq ft. This pressure on the market is set to get some relief soon, as there is another 1.9m sq ft under construction.

Because of these low supply levels, B8RE noted that rents can be higher than before. It is no surprise then that Scientific Gaming’s lease of 91,000 sq ft at Omega in Warrington has a headline record rent of £9.5/sq ft – the headline rent of the year before was £8/sq ft.

Other notable leases included Jet2 taking 152,000 sq ft at MA6NITUDE in Middlewich and TK Maxx’s leasing of 456,700 sq ft at PLP Crewe.

While the big box market suffered, the mid-box and multi-let industrial property markets remained strong, B8RE said.

“Economic uncertainty, influenced by inflation and rising interest rates, has undoubtedly resulted in caution on the part of occupiers,” said Will Kenyon, B8RE industrial agency member.

“However, with almost 1.27m sq ft of space in solicitors’ hands and several unsatisfied high-profile requirements we anticipate stronger take-up levels in the second half. Low supply levels are helping to maintain rental growth.”

Kenyon also noted the growing importance of ESG credentials in the leasing market.

“Operational efficiencies and ESG credentials continue to be important to occupiers and many are looking to move to more modern premises,” Kenyon said. “An increasing number of investors are also announcing they are unable to acquire assets that do not meet their ESG requirements.”

About ESG

Kenyon’s observation builds upon a recent Knight Frank report which clocked that more than half of the North West’s warehouse space could become ‘unlettable’ by 2030 because of its inability to achieve a minimum EPC rating of B.

This is not just a North West issue. The national government is enforcing a requirement for all industrial space to be EPC C by 2027, and then EPC B by 2030. Nationwide, Knight Frank notes that the EPC B requirement would eliminate 404m sq ft of industrial space from the letting pool.

Properties that can offer ESG credentials stand to benefit, with industrial rents predicted to grow by 3.1% a year over the next five years for these units, according to Knight Frank.

“Landlords who take action now to retrofit are already reaping the rewards,” said Knight Frank senior surveyor Bradley Norton. “Occupiers are prioritising more energy-efficient premises as they look to deliver on their own ESG credentials and with a slow-down of new stock, second-hand space has to be improved.”

Charles Binks, head of logistics and industrial at Knight Frank, elaborated: “While newly constructed warehouses generally meet top sustainability standards, 82% of the UK’s existing stock built before the year 2000, do not meet minimum EPC requirements.

“It is obvious that significant capital expenditure is required to retrofit these warehouses and mitigate obsolescence risk, however just 6% have undergone upgrades in the past five years,” Binks continued.

“The prospects for rental growth should offer incentive. However, investors must accelerate the rate at which older facilities are upgraded or they will become unlettable.”

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