South West industrial rents rising to record levels

Tim Davies

Tim Davies

Research carried out by surveyors Colliers International suggests that a clear lack of industrial units in the South West may hinder the growth of the local economy.

Furthermore this limited supply of space combined with an increase in demand is leading to as significant increase in rental levels across the region.

Strong demand for units between 10,000 to 30,000 sq ft has seen secondary rents increase over the past year by almost 30 per cent in Swindon and Bristol to £4.50 per sq ft £6 per sq ft respectively.

There were also increases in the smaller markets of Exeter and Gloucester of 18 per cent and 14 per cent respectively, with prices per sq ft increasing to £5 in Exeter and £6 in Gloucester.

Prime rents also showed significant improvement, rising by 15 per cent in a year to £8 per sq ft in Bristol, and by 10 per cent to £6.50 in Swindon.

Tim Davies, Director in the Industrial & Logistics team at Colliers International in Bristol, said: “An acute shortage of units combined with an increase in occupier demand is forcing rents to record levels in the South West.

“Clear evidence of rental growth and access to funding is encouraging developers to speculatively develop units for the first time in a decade,” he said.

“I think that new stock is an absolute must for the South West.”

Colliers’ research revealed that on average rents across the UK as a whole have jumped considerably between June 2014 and July 2015 – by 18 per cent for big sheds and 15 per cent for smaller sheds.