With one year's supply remaining and no speculative pipeline underway, the East of England faces intensifying competition for modern logistics space.
A constrained development pipeline, alongside limited availability of best-in-class space, is creating clear opportunities for design and build solutions, with planning secured at schemes such as Flagship Park in Peterborough and Newlands Park in Huntingdon. A number of existing units are currently under offer, underpinning a stronger H2 2026 outlook, while competitive occupier interest is beginning to place upward pressure on rents.
Edward Gee, Director, Commercial
Flagship Park, Peterborough – Planning secured for a 352,033 sq ft BREEAM Excellent unit at Flagship Park, Peterborough. Site works are underway, with build-to-suit options available up to 850,000 sq ft, freehold or leasehold
Supply
At the end of H1 2026, the available supply in the market has risen by 35% compared with the end of H1 2025. The current availability amounts to 2.28 million sq ft, reflecting a vacancy rate of 7.15%, which has increased from 5.39% the previous year. Based on the current five-year average annual take-up, the market has one year's worth of supply remaining, pointing to an undersupplied market.
Across the region, seven units are available in the 100,000–200,000 sq ft range, four in the 200,000–300,000 sq ft range, one in the 300,000–400,000 sq ft range, and none over 400,000 sq ft, making larger requirements difficult to meet, especially in core market locations.
Proportionally, of the 2.28 million sq ft available, most is poor-quality Grade C space (51%). The next most common type is second-hand Grade A space, accounting for 32%, with the remainder consisting of new-build Grade A (6%) and Grade B (11%).
The high proportion of available Grade C stock in the East of England presents occupiers with more affordable industrial space, making the region an attractive option for businesses seeking cost-effective alternatives amid rising occupancy costs.
Take-up
Persistent geopolitical challenges and increasing costs of construction have impacted transactional activity, with take-up in H1 2026 totalling 106,000 sq ft across one transaction, which is down 41% on H1 2025, when 178,000 sq ft was taken up.
However, despite the majority of stock being of poorer quality, Q2 2026 saw the first pre-let transaction in the market since the start of 2023, indicating that occupiers are starting to take advantage of the tight supply dynamics in the market.
In H1 2026, all space transacted was occupied by third-party logistics providers.
Within the market, there is divergence between the markets, with activity focused on Cambridgeshire and the surrounding markets in comparison to Suffolk and the surrounding markets. But we are seeing an uptick in enquiries, indicating the market may see more activity as we move through 2026.
Additionally, given the region’s shortage of new-build stock, Savills in-house rental growth projections, based on a baseline scenario, suggest the region will experience an average rental increase of 3.8% over the coming years. This is supported by the scarcity of top-tier assets from existing units, a situation likely to persist due to the absence of an active speculative development pipeline.
Development pipeline
Across the East of England, there is a shortage of new speculative Grade A units, with the pre-let of Unit 12 at Port One Logistics Park to Bacton Logistics in Q2 2026. However, the market presents future opportunities, with planning secured for a 352,000 sq ft unit at Flagship Park, Peterborough, alongside design-and-build options available up to 850,000 sq ft. The site has a power capacity of up to 17.5 MVA, which could unlock future demand from developers and occupiers, especially those with electric fleets or operating in power-intensive industries such as defence and manufacturing.