Pockets of undersupplied size bands, but the bulk of space sits in the 100,000–300,000 sq ft band
H1 2025 has been a challenging start to the year. Against a backdrop of economic uncertainty, we have seen a small reduction in take-up levels. However, there are significant transactions in the pipeline, and we expect to see an outcome comparable to pre-Covid levels
Jonathan Atherton, Regional Head, Industrial and Logistics
Trafford 150, a recently constructed speculative unit which Savills is marketing
Supply
Compared to twelve months ago, the total available supply has increased by 34%, but this is partly due to the reintroduction of approximately 690,000 sq ft of low-quality, second-hand space to the market, as well as the completion of 2.73 million sq ft of new, speculative space. Currently, there is 7.80 million sq ft of vacant space across 40 units in the region.
By grade, 51% of the vacant space comprises good-quality, Grade A speculatively developed space, 9% is second-hand Grade A space, 16% is second-hand Grade B space, and 24% is second-hand low-quality Grade C space.
By unit size, there are currently 28 units in the 100,000–200,000 sq ft range, five in the 200,000–300,000 sq ft range, four in the 300,000–400,000 sq ft range, one in the 400,000–500,000 sq ft range, and two over 500,000 sq ft. Supply and demand patterns across various size ranges indicate that the 100,000–200,000 sq ft and 300,000–400,000 sq ft categories are oversupplied, although the situation varies significantly at the micro-market level. For units between 200,000 and 300,000 sq ft or above 500,000 sq ft, the supply-demand balance is more favourable.
Despite macroeconomic headwinds, Savills still anticipates rental growth in this region to outperform the rest of the UK. Our baseline forecast predicts a 5.3% annual rental increase over the next five years, or as high as 5.6% per annum in our optimistic forecast.
Take-up
Amid ongoing economic and political uncertainties, decision-making is taking longer or being delayed. Combined with the increased supply of higher-quality stock in more central regions, this is reducing take-up across the North West. H1 2025 take-up totalled 1.29 million sq ft across eight transactions, a 7% decrease compared to H1 2024 and a 36% decrease compared to the long-term H1 average.
In H1 2025, second-hand space, including second-hand A, B, or low-quality C space, made up 79% of activity. However, top-tier buildings, whether Grade A new (Spec) or refurbished Grade A, remain the most desirable due to modern occupier and operational needs. In H1 2025, 57% of the space transacted was second-hand Grade A or Spec; 16% was Grade B, and 26% was Grade C.
Lower activity in smaller size ranges, compared to long-term averages, has also not helped boost take-up levels. In H1 2025, seven transactions occurred in the 100,000–200,000 sq ft size range and one in the 300,000–400,000 sq ft size range. No deals were signed for any other size. These results, when compared to long-term H1 averages, indicate that the 100,000–200,000 sq ft size range is outperforming. However, the other size ranges are generally lagging, with typically six transactions annually in the 100,000–200,000 sq ft range, two in the 200,000–300,000 sq ft range, two in the 300,000–400,000 sq ft range, one in the 400,000–500,000 sq ft range, and two over 500,000 sq ft.
24% of H1 2025 take-up was related to manufacturing, emphasising that domestic manufacturing needs are rising amid geopolitical tensions. 31% was by wholesale retailers, 29% by food producers, and 8% by 3PL firms.
Development pipeline
Eight speculative units totalling 1.50 million sq ft are currently under construction across the North West. Of these, six units fall within the 100,000–200,000 sq ft size range, which could lead to oversupply in this category in the short to medium term. There is one unit in the 300,000–400,000 sq ft size range and one in the 400,000–500,000 sq ft size range, leaving larger occupier requirements unfulfilled unless they opt for a BTS solution.