UK Big Box 2023

JLL’s latest data on the big box industrial and logistics market highlights a fall in occupational take-up in 2023, compared with the elevated level posted in 2022 and the average over the three years 2020 to 2022 which saw a Covid and post-Covid surge in demand. However, take-up was still higher than the pre-Covid annual average. Demand for prime buildings in core geographies remained relatively resilient.

‘Headline’ supply available on new leases rose over the year to 36.0 million sq ft at the end of 2023 and there was an additional 5.8 million sq ft available in ‘grey’ space by way of assignment or sub-leases. Overall, total supply equated to around two years of 2023 take-up, but in certain regions, such as the East Midlands, this ratio is close to one year.

Prime headline rental growth decelerated but across GB prime headline rents still posted growth of 7.8%.

In our view 2023 represented a market re-set after three exceptional years of occupational demand rather than a more fundamental retrenchment.

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