An increase in demand for warehouse space is likely to see a five-year boom to provide more new space…
Internet retailers demanding more space is set to increase construction in the warehouse sector, it has emerged.
Property consultants Lambert Smith Hampton said by 2020 demand will outstrip supply by 25 million sq ft.
The boom will undoubtedly please warehouse construction specialists, who will benefit from a glut of work over the next few years.
The findings were showcased in the firm’s annual Industrial & Logisitics Market Report, which stated “that a significant and unprecedented increase in construction will be required in the next few years to ensure internet retailers are able to continue to fulfil their customer orders.”
Lambert Smith Hampton’s national head of Industrial and Logistics Steve Williams said: “E-commerce in the UK is not just growing rapidly, but it’s also evolving as retailers attempt to satisfy consumer demand ever more quickly and efficiently.
“This is resulting in unprecedented demand for strategically located logistics warehouse space across many parts of the country.
“Whilst we’ve seen new warehouses being developed over the past couple of years, the amount of new space being planned simply can’t keep pace with the demands of internet retailers and their distributors.
“Unless developers start building warehouses at a rate that we haven’t witnessed during the 20 years I’ve been working in the sector, or major occupiers like Amazon are prepared to wait 12 months for delivery by building it themselves, we could run out of logistics space before the end of the decade.
“The impact of the growth of e-commerce on the retail industry has been well documented and steps are being taken to try to address some of the issues facing our high streets.
“However, the logistics industry will also need to adapt urgently if it’s to continue to support internet retailers in fulfiling their customer orders.
“Some of the sector’s more forward-thinking participants have already recognised this, but more needs to be done if we want to continue to enjoy the benefits of e-commerce.”