The biggest challenge facing the logistics industry

Developers that have either a good land position or good quality speculative product to let should have had a good 2014 and should be having an even better 2015. Also, the increased levels of demand for logistics space, together with the significant lack of supply of quality space in the core distribution locations, means that, for the first time in my working career, there is some significant rental growth outside the South East.

Roxhill has been focused on placing itself in a position where we can provide the type of product occupiers require in the core distribution markets of the Midlands and the South East by controlling land, achieving planning permission and, with most of our sites, preparing them with infrastructure. Along with other developers (notably Prologis for DIRFT Phase 3) we have had good success in the last few years by bringing forward large sites through the planning process.

However, the biggest challenge facing Roxhill, and indeed the whole of the logistics industry over the coming years, is where the next significant sites are coming from. There still appears to be no joined-up thinking between government and local authorities in bringing forward land that will be required to satisfy the increased levels of demand for logistics space.

All the research indicates there are good levels of demand from retailers for warehouses storing product ready to be moved into retail outlets. However, all this research also points towards rapidly increasing warehouse requirements for products being bought via other channels such as the internet. This will mean even more demand for logistics space, which the industry will have to find a way of providing.

This is the biggest challenge facing our industry and I hope that we can work with local authorities and the government to bring forward the kind of employment development land the growing UK economy requires.

Jason Dalby is managing director at Roxhill Developments