Is warehousing the next boom industry

We’re all used to buying online these days – a shopping habit that has caused many a high street name to bemoan the lack of passing trade and in the case of the iconic US department store, Sears, been directly cited as a reason for bankruptcy. It’s not all bad news though – in fact, for some sectors such as warehousing, the boom in online shopping is excellent for business.

According to the latest figures from property research firm CBRE, there has been almost a doubling in demand for warehouse space in the last decade as ecommerce retailers have soared in popularity, expanded product lines and built multi-million pound businesses.

CBRE’s research figures show that in 2007, 130 million sq ft or warehousing space was purchased or leased. Fast forward to 2018 and that amount has leapt to 235 million sq ft.

There’s more good news too. While the North South divide is something that is often cited as favouring the South, and places like Yorkshire, Nottinghamshire and Manchester have seen traditional industries floundering, those regions North of Watford are actually benefitting the most from this burgeoning demand.

Northamptonshire, Leicestershire and Derbyshire in the East Midlands are faring particularly well thanks to the presence of the M1, proximity to the A1, the freight terminal at East Midlands airport and excellent rail links. The logistics sector has dubbed this the ‘Golden Triangle’ in an inspired marketing effort – conveying that 90% of the population of England and Wales can be reached in a maximum of just four hours from this sweet spot. As a result, demand for warehouse space is immense and has grown at a rate that CBRE describes as ‘unprecedented’.

Andrew Marston from CBRE says, “Growth has come from online retailers, a number of which have been rapidly expanding their distribution networks.”

As a result of the online retail demand, around 7000 new jobs and 11 new warehouse spaces have been created in the regions.

For its part, East Midlands Airport says it has also been impacted by the warehouse boom, with a huge growth in the number of cargo planes landing and departing from the airport. It says that around 20 planes per hour new take off and land at the cargo terminal.

So far, DHL is one of the biggest and earliest logistics brands to stake its claim, with a £150 million investment in the region.

My Cart