01/20/2021 | Press release | Distributed by Public on 01/20/2021 03:00
Savills notes that take-up was dominated by food manufacturers accounting for 34%, followed by 3PLs and online retailers at 31% and 13% respectively. Out of the nine transactions, 75% were for Grade A space suggesting that occupier preference remains for top quality stock.
Key deals in the region included the sale of 42 acres of land at Jaynic's Suffolk Park in Bury St Edmunds to Weerts, the Belgian logistics firm, for the construction of an 870,000 sq ft (80,825 sq m) unit. Upon completion this will be the largest single warehouse in the county. Other significant transactions has seen the sale of the former 300,126 sq ft (27,882 sq m) Philips Avent factory in Glemsford to a Malaysian cocoa manufacturer and the pre-let of 143,000 sq ft (13,285 sq m) to FDS at Port One in Great Blakenham. Elsewhere in Peterborough, the Church Commissioners and Trebor Developments have now received outline planning consent for the new 80 acre (32 hectare) Flagship Park in Eastern Industry.
As a result of strong transactional activity Savills has seen downward pressure on supply, however the recent marketing of the 736,000 sq ft (68,376 sq m) unit at Kingston Park in Peterborough has meant that it remains stable at 1.47 million sq ft (136,567 sq m). What's more, 92% is now classed as Grade A, compared with 15% six months ago, in line with what occupiers want.
Despite this, there is currently very little speculative development planned for the region and the aforementioned 736 Kingston Park accounts for half of the total supply and circa 50% of all Grade A space currently available. This equates to just 0.78 years of supply across the region. There does, however, remain build-to-suit opportunities at schemes including Suffolk Park in Bury St Edmunds, Gateway 14 in Stowmarket, Eastern Gateway in Ipswich and Port One at Great Blakenham.
Phil Dennis, director in the business space team at Savills Chelmsford, comments: 'It is excellent news that the East of England continues to outperform, with some significant deals taking place in 2020. However, it is important to note that, unlike last year, there is hardly any development planned for the region meaning we are starting to see sustained rental growth. With considerable demand, particularly for Grade A space, it is crucial that we see spades in the ground in 2021 in order to sustain this level of take-up moving forward.'