News: Why are big warehouses being built in Rotherham?
Developers are answering the call for more much needed warehouse space in the Sheffield region as evidenced by large scale new developments in Rotherham.
The KKR-backed specialist asset manager, Mirastar, recently agreed to finance the development of Catalyst, through M1 Agency. The 18-acre site sits on Sheffield Business Park, incorporating 285,000 sq ft across five units with a value of £60m.
Outline plans were approved in 2019 to enable the successful Sheffield Business Park to expand into Rotherham. The fourth phase is being built on a 17.9-acre site that was previously kept in the greenbelt when Sheffield City Airport was in operation.
Premcor, a private UK based property development company, joined with Peveril Securities, a wholly owned investment and development division of Bowmer and Kirkland, to work together on their first ever South Yorkshire site.
Barnfield Construction is making swift progress alongside the Parkway.
At Hellaby, work is underway on a huge distribution centre development alongside the M18 motorway.
Panattoni, the largest industrial real estate developer in Europe, bought the site and is bringing forward a unit of 630,000 sq ft, which will be one of the largest-ever speculative logistics buildings in the north of England, and a smaller 80,000 sq ft facility. Completion is expected in July 2023.
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Henry Watson, lead agent at M1 Agency in the Yorkshire and The North East said: “The market dynamic in Sheffield and surrounding area demonstrates a chronic imbalance between an extreme amount of demand and a huge lack of supply.
“The unprecedented growth demand for last mile solutions shown in Sheffield and the wider South Yorkshire conurbations has been triggered by the rise of the convenience economy driven by mobile technology.
“Proximity to customers is becoming ever important as goods need to be moved quicker and more often, intensifying the demand for space in last-mile locations.”
But it is not just last mile warehousing required in the region. Watson said: “Demand has continued to outweigh supply within the big box market too. The dynamic shift in consumer habits with increased multi-channel retail has created further extra-large scale requirements because of the nature of e-fulfilment.
“While e-commerce is one of the primary drivers of the ongoing large-scale warehousing demand, we are also seeing third-party logistics providers transitioning to larger multi-user facilities and consolidating their estates.
“With slimming margins on retail sales, occupiers have been looking at their logistics and supply chain management to reduce costs and increase profitability."
A latest study by agents, Knight Frank for the region confirms that it is a lack of supply and continued occupier demand that has driven the appetite for speculative development.
At the end of Q2 2022, there was 1.83 million sq ft of space immediately available. However, 73% was under offer with further availbale space in advance discussions.
Rebecca Schofield, partner and head of the Yorkshire Industrial team at Knight Frank in Sheffield, said: "Despite the caution that has entered the investment market, occupier demand and enquiries remain robust and we expect levels of interest to continue in respect of the further speculative development planned, including Panattoni Park in Rotherham, Barnsley 340, Bessemer Park Sheffield, Horizon 29 at Chesterfield and Unity Doncaster.”
M1 Agency website
Knight Frank website
Images: M1 Agency
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The KKR-backed specialist asset manager, Mirastar, recently agreed to finance the development of Catalyst, through M1 Agency. The 18-acre site sits on Sheffield Business Park, incorporating 285,000 sq ft across five units with a value of £60m.
Outline plans were approved in 2019 to enable the successful Sheffield Business Park to expand into Rotherham. The fourth phase is being built on a 17.9-acre site that was previously kept in the greenbelt when Sheffield City Airport was in operation.
Premcor, a private UK based property development company, joined with Peveril Securities, a wholly owned investment and development division of Bowmer and Kirkland, to work together on their first ever South Yorkshire site.
Barnfield Construction is making swift progress alongside the Parkway.
At Hellaby, work is underway on a huge distribution centre development alongside the M18 motorway.
Panattoni, the largest industrial real estate developer in Europe, bought the site and is bringing forward a unit of 630,000 sq ft, which will be one of the largest-ever speculative logistics buildings in the north of England, and a smaller 80,000 sq ft facility. Completion is expected in July 2023.
Advertisement
Henry Watson, lead agent at M1 Agency in the Yorkshire and The North East said: “The market dynamic in Sheffield and surrounding area demonstrates a chronic imbalance between an extreme amount of demand and a huge lack of supply.
“The unprecedented growth demand for last mile solutions shown in Sheffield and the wider South Yorkshire conurbations has been triggered by the rise of the convenience economy driven by mobile technology.
“Proximity to customers is becoming ever important as goods need to be moved quicker and more often, intensifying the demand for space in last-mile locations.”
But it is not just last mile warehousing required in the region. Watson said: “Demand has continued to outweigh supply within the big box market too. The dynamic shift in consumer habits with increased multi-channel retail has created further extra-large scale requirements because of the nature of e-fulfilment.
“While e-commerce is one of the primary drivers of the ongoing large-scale warehousing demand, we are also seeing third-party logistics providers transitioning to larger multi-user facilities and consolidating their estates.
“With slimming margins on retail sales, occupiers have been looking at their logistics and supply chain management to reduce costs and increase profitability."
A latest study by agents, Knight Frank for the region confirms that it is a lack of supply and continued occupier demand that has driven the appetite for speculative development.
At the end of Q2 2022, there was 1.83 million sq ft of space immediately available. However, 73% was under offer with further availbale space in advance discussions.
Rebecca Schofield, partner and head of the Yorkshire Industrial team at Knight Frank in Sheffield, said: "Despite the caution that has entered the investment market, occupier demand and enquiries remain robust and we expect levels of interest to continue in respect of the further speculative development planned, including Panattoni Park in Rotherham, Barnsley 340, Bessemer Park Sheffield, Horizon 29 at Chesterfield and Unity Doncaster.”
M1 Agency website
Knight Frank website
Images: M1 Agency
