Supply

The level of supply within the wider region has remained steady. Currently, there is 4.6m sq ft available through 23 units, representing a 1% decrease in the last 12 months.

The vacancy rate in the region has decreased by 65 basis points in the last 12 months to stand at 5.74%. Using the five-year annual average take-up, there is now just 0.69 years worth of supply in the region.

Strong levels of transactional activity involving Grade A space has considerably reduced the amount in supply, 40% of vacant space is now classed as Grade A down from 50% at the start of last year. Furthermore, 41% of all space is second-hand Grade B and 19% Grade C.

By unit count, the supply is skewed towards the smaller size bands with 65% being between 100,000–200,000 sq ft, 17% within the 200,000–300,000 sq ft size band and 9% in both the 300,000–400,000 and 400,000–500,000 sq ft size bands.

Take-up

Following the two strongest years of take-up ever recorded in the market, 2020 has outperformed expectations with take-up totalling 10.35m sq ft through 21 transactions representing a 56% increase on 2019.

Of the space transacted, 70% was build-to-suit, 27% second hand and 3% new speculatively developed space. The largest deal in 2020 was Amazon committing to 2.5m sq ft at Follingsby Max in Gateshead. In terms of deal count, 52% were within the 100,000–200,000 sq ft size band, 14% within the 300,000–400,000 sq ft size band, 5% within the 400,000–500,000 sq ft size band and 29% in the 500,000 sq ft+ size band. The average deal size in the region has increased substantially in the last 10 years from 190,442 sq ft to 492,667 sq ft in 2020.

Development pipeline

There are currently four units under construction totalling 1.09m sq ft. The largest unit is Wakefield 515 in Knottingley totalling 515,000 sq ft.

_{Read the articles within Big Shed Briefing below.}