Our industrial warehouse to let in Bristol helps to meet increasingly high demand

Supply and demand is one of the most fundamental building blocks for business. Yet when it comes to building space in which those businesses can work, developers often struggle to get the balance right. Human behaviour plays a part, along with cashflow. We see the economy take a dive, and everyone stops building. No one wants empty, costly properties on their hands. But then the economy picks up. Construction is a slow beast that takes time to limber up and gather speed. Which leaves a gap between supply and demand that can hamper the prospects of growth and recovery.

And that is where Bristol finds itself now. While we celebrate every tech company that invests in the city, and heap praise on the trendy inner city office spaces they love so much, such as the Engine Shed and Temple Studios. The truth is that we need more industrial warehouses space to let, such as Central Park, in order for Bristol to continue its remarkable growth.

James Morgan, head of the industrial agency department at CBRE Bristol, said: “In Bristol it is becoming more and more evident that there is a lack of supply for industrial and logistics premises, and this is reflected across all size ranges.” He said this was apparent in the rise in demand for industrial space since the turn of the year with a number of sites let. “This coupled with the fact there has been no significant speculative development in the last seven years has led to supply levels of industrial stock reducing dramatically,” said James. “Demand for large industrial premises tends to come from retailers and third party logistics operators as well as parcel delivery companies, all of which have requirements for the Bristol area. There is a noticeable lack of supply of larger industrial buildings in Bristol, which means occupiers will struggle to identify suitable premises.”

This could cost the local economy as organisations simply look elsewhere. Bristol maybe well placed with good links around the country via the M4 and M5, but it’s not the only option. And it is not just big sites in demand. Colliers International’s Danielle Hatton said: “Smaller units are still available in Avonmouth – we are seeing considerable activity in the smaller size bracket alongside the major movements in large sheds. We are also finding that tenants are demanding better quality space these days – prompting more owners and landlords to take the plunge and refurbish their remaining secondary stock.”

Andy Ridler, right, of another property agency Alder King, put the rise in demand down to renewed economic confidence in not just logistics but also manufacturing. He said Bristol benefited from an established multi-sector, multi-skilled workforce and two leading universities providing world-leading research facilities. He said half year take up of industrial space was around 800,000 square feet, a number he said was “depressed”. “The lack of good quality, immediately available supply is holding back take up,” said Andy. “Demand is sustainable as it comes from a wide variety of sectors but is particularly strong from added value and technology-based manufacturers as well as from the construction, logistics and e-retailing fulfilment sectors.”

Andy said the demand was broad across a range of sizes. “What’s noticeable is that demand is not restricted to one particular size range, eg the big sheds,” he said. “Demand is coming from across the size spectrum, from small owner managers looking for around 1,000-5,000 sq ft of space, to those in the aerospace supply chain and distributors looking to drive further efficiencies in their distribution networks with space of around 10,000-25,000 sq ft. There has also been a particular return of mid-range requirements in the 25,000-75,000 sq ft size range.” He said supply stood at 2.5 million sq ft of available space – the lowest for 10 years. And a “significant proportion” of that is poor quality. “Demand far outstrips the amount of good quality available buildings,” said Andy. “There is a two-tier market, with a large gap between the good and poorer quality space. Prospective occupiers are surprised at how little available quality space there is. This is the legacy of the last development cycle when some of Bristol’s land supply was lost to other uses, eg offices, and not replaced.”

The good news is there is land available where new industrial sites can be built, particularly in Avonmouth as well as possibly around the developments in Filton and Emersons Green. And the supply problem is not unique to Bristol. Tim Davies, head of Colliers International’s Bristol office, said soaring demand for quality accommodation around London had promoted more businesses to look further down the M4. “The faster than expected recovery has placed a major strain on supply of quality accommodation in the greater London, Birmingham and Manchester regions,” he said. “This shifts attention to Avonmouth and Severnside, which given its location beside the M4/M5 interchange, could be as handy for firms needing Midlands connections as it is for businesses in the capital.”

Farm Foods recently announced it is to open a 175,000 sq ft distribution centre at our very own Central Park – the warehouse premises to let, alongside the Chep pallet premises. Other major occupiers include Morrisons, Tesco, Asda and the Co-op, which goes to show how Central Park is more then up to the task of meeting this high demand and is ready for more.

Source: Bristol Post