Just over a year ago, pre the Covid-19 pandemic, we wrote a piece of editorial that focused on the strength in the commercial property market in the North East and within Teesside in particular. Just a couple of weeks after writing we were amidst one of the most economically uncertain times in living memory and for a short period the commercial property market went into standstill.
Despite this inevitably period of uncertainty it has been great to see the Teesside property market displaying it’s resilience and no one sector has displayed this more than the industrial market.
The industrial and logistics market has long been viewed by investors as less favourable in comparison to other core commercial property market sectors such as office and retail. However with changing demographics and the continued growth of ecommerce the UK industrial logistics sector has experienced strong levels of growth consistently over the past five years. Our agency team has witnessed this growth first-hand at both an occupier and an investment level with demand largely outstripping supply across all major UK regions.
As a result of the COVID-19 pandemic the industrial and logistics market has only continued to flourish as well as the aforementioned demographic and supply /demand factors there have been the addition of many office retail and leisure properties being closed. it’s been widely reported the online sales have doubled in the space of nine months from March 2020 with E Commerce and delivery companies accounting for nearly 40% of annual take up. This ‘perfect storm’ of conditions culminated in the strongest Q4 ever recorded for the industrial sector with over 14.3 million square feet and an annual take up of 50.4 million square feet across the UK.
The North East has followed this national trend and the industrial property sector has outperformed other sectors in recent years with a greater evidence of transactions on both the sales and letting front. There’s no doubt that location remains a key factor in demand for industrial units with the most popular industrial states benefiting from close proximity to good communication links. The preferred location for such sites within NE continues to be alongside the A1 and A19 corridors.
Over the past 12 months we’ve brought a raft of new instructions to market and as mentioned previously we’re experiencing unprecedented levels of demand so the majority of these have been sold or let within months of coming to market.
We’ve also been involved in Station Place at Newton Aycliffe since the schemes inception and with work starting on site earlier this month it’s set to provide over 50,000sq ft of much needed new industrial space for the region.