It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.
It has become something of a tradition, given that we’ve been doing this now for over 30 years.
Here we speak to Andrew Gent, a director at Leeds-based property consultancy GV&Co, who is hoping that 2025 will be a better year for the big-shed market following a year of uncertainty in 2024.
Nationally take up of industrial properties over 100,000 sq ft during 2024 was up on the year before. However, most was in the Midlands and in the ‘Golden Triangle’ serving the south-east conurbations. 2024 was a slow year for take up in the Yorkshire region, with many businesses including on and offline retailers deferring decisions until the general election, and then when we hoped things might kick on, the market held back, waiting for the budget, which didn’t really deliver what businesses were looking for!
With an increase in national insurance and the minimum wage, labour costs are on the up and some businesses are re-thinking their plans, with deals stalling or being pulled all together. This may lead to a move towards automation, as increased labour costs give the capital investment a quicker pay back and remove future uncertainties over additional labour cost rises.
There are positive signs for 2025, with a number of pending deals which, if transacted, will give the Yorkshire market a fillip and set the scene for the rest of the year to push on. Factor in the government’s push for additional housing, which in itself will lead to increased demand for warehousing and in particular last mile delivery facilities, and 2025 could see increased demand for warehouse space. Plus, the return of Amazon to the marketplace could be another positive.
However, to a greater degree, current take up is being driven by strategic thinking as opposed to a response to increased sales and we have seen a degree of secondary space return to the market as occupiers look to modernise their supply chains, which is balancing the market in terms of supply and demand.
There are however headwinds in the offing, and whilst government rhetoric has been about economic growth so far, the budget has failed to inspire confidence with zero growth reported from July to September. Let’s hope that the anticipated raft of early lettings materialises and that the underlying metrics for the Big Shed market outweigh the short-term economic conditions.
