Supply falls by 6% resulting in undersupply in some sub-markets
An uptick in take-up in H1 2025 has been registered as 3PL occupiers returned to the market, resulting in a fall in the vacancy rate across the region. However, there continues to be issues surrounding the viability of BTS development, with many of the requirements filtering towards existing larger stock, resulting in the vacancy rate falling further
Tom Asher, Director, Industrial and Logistics
Savills is instructed to market Doncaster 420 on behalf of Panattoni – the largest immediately available warehouse in Yorkshire
Supply
The amount of available warehouse space has fallen by 6% over the last 12 months, to now stand at 9.08 million sq ft across the two regions, with 6.97 million sq ft in Yorkshire & The Humber and 2.11 million sq ft in the North East. The vacancy rate across the two regions now stands at 8.63%.
By unit count, there are 23 units in the 100,000–200,000 sq ft range, eleven units in the 200,000–300,000 sq ft range, four units in the 300,000–400,000 sq ft range, and four units in the 400,000–500,000 sq ft range.
Of the space on the market, 43% is classified as Grade A speculative development, 11% is second-hand Grade A, 11% is Grade B, and 35% is low-quality Grade C. This indicates the growing trend of occupiers preferring best-in-class units, with many low-quality units coming back to market for redevelopment/refurbishment.
There are currently no units over 500,000 sq ft immediately available and only eight units over 300,000 sq ft. The largest immediately available building is Panattoni’s Doncaster 420 at 418,276 sq ft. Across the two regions, there is only 1.15 years’ worth of supply available. This supply dynamic creates opportunities for developers to consider building new, larger speculative developments in certain sub-markets or investing in the redevelopment of existing units to meet occupier demand.
Take-up
Take-up across Yorkshire and the North East has increased by 48% over the last twelve months, totalling 3.1 million sq ft across 14 transactions, the highest half-year since H2 2022. This increase in transactional activity indicates a strengthening in the market despite the recent geopolitical and economic uncertainty.
By unit count, there were eight transactions in the 100,000–200,000 sq ft range, three in the 200,000–300,000 sq ft range, two in the 300,000–400,000 sq ft range, and one transaction over 500,000 sq ft. This is the first transaction over 500,000 sq ft since 2023 and can be attributed to the leasing of Sherburn 550 by ID Logistics.
When analysing take-up by specification, 64% of space transacted was second-hand, 26% was new speculative development space, and 10% was BTS space. In terms of grade, 76% involved best-in-class Grade A space, 3% involved Grade B space, and 21% involved low-quality Grade C space. By occupier sector, 56% came from 3PLs, 25% from manufacturing companies, 9% from automotive companies, and the remainder split out between food producers and wholesalers. Take-up in H1 2025 has seen a return of 3PLs dominating the Yorkshire and the North East Market.
Development pipeline
There are currently four units under construction in the Yorkshire market, totalling 1.73 million sq ft, with two units in the 200,000–300,000 sq ft range, one unit in the 400,000–500,000 sq ft range and one unit in the over 500,000 sq ft range. The North East market has no upcoming speculative development, creating a gap in the market for developers.