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Warehouse space in high demand

Warehouse space in high demand

Due to a change in consumer spending towards online shopping demand for warehouse space has doubled in the past 10 years. Previously, retailers only accounted for a third of warehouse space; in comparison to now where 60% of the space is occupied by retailers.

The increase in demand for warehouse space has come from online retailers, as well as discount grocery chains Lidl and Aldi.

The shift in consumer spending has both positives and negatives. The expansion of distribution units has increased employment opportunities. At the East Midlands Gateway, development of 11 new units is currently underway, which is set to host Amazon, Shop Direct and Nestle and create 7000 new jobs.

On the downside, the increase in online retailing, along with high rent rates and the shift in consumer spending has had a negative impact on high street stores. This year alone a total of 35,000 job losses have come from the closures of, Toys R Us and Maplin with Marks and Spencer, Tesco Direct, Sainsbury’s and House of Fraser announcing store cuts.

Is this a sign that online retailing is replacing our traditional and well-loved high streets? Those retailers with a strong brand may well survive the pressure from online retailers and a day out shopping is still seen by many as a leisure activity.

However, let’s watch this space.

If you are a retailer looking to secure warehouse space or you have a general query and would like to book an appointment with our Commercial Real Estate team then please get in touch with our First Contact team on 01256 320555 or email mail@clarkeandson.co.uk.

Phil Dixon

Head of Commercial Real Estate

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