Industrial and retail see slowdown for new space in the South East

Radius Data Exchange analysis shows that the South East* is the second-most constrained regional market in terms of industrial supply against current active demand, with just 2.3 years’ worth of standing stock currently on the market. This is further accentuated when we factor in space which is close to transacting. Close to 2m sq ft of industrial stock across the South East is currently under-offer – far more than any other region – and drops the absorption rate down to just 2.1 years’ worth of stock currently being actively marketed. The retail sector in the South East is also outperforming national trends in terms of absorption rate – with just 2.7 years’ worth of stock available against a UK-wide average of 2.8 years. Despite these letting performances, both retail and industrial sectors have seen a slowdown in terms of new space coming through the planning system over the past 12 months. While this is certainly understandable in the retail sector at present, given the struggles therein over the last few months, there could perhaps be more of an opportunity in the industrial sector. The amount of industrial space approved in the South East dropped by 12%, against an increase of 6% nationally – which is surprising given the relatively strong rate of demand at present. Particularly under-served in South East warehousing is the 0-25,000 sq ft size band, with just 1.7 years’ worth of stock remaining at current the current rate of demand, and volume of new permissions in this size range showing no growth on the previous year. To send feedback, e-mail graham.shone@egi.co.uk or tweet @GShoneEG or @estatesgazette * South East refers to the region outside of London.