The emerging trend of industrial intensification is bringing distribution centres much closer to residential developments, and bringing new opportunities for developers, occupiers and communities.
Would you choose to live in an industrial building? Not a Victorian warehouse conversion, but a fully functioning, 24/7 distribution centre? It’s an unlikely first choice for urban residents, but London’s planners and supporters of ‘industrial intensification’ want to change your mind.
In recent decades, high housing demand has seen many industrial sites converted to housing; London has lost a quarter of its industrial floorspace in the past 20 years. The result is a shortage of space for logistics and small and medium- sized businesses.
Massive growth in ecommerce means distribution facilities near population centres are urgently needed. There is not enough urban land for sites to be dedicated to either logistics or housing. Planning authorities must work with investors and developers to meet the competing demands of both.
Could the solution be industrial intensification? Co-locating industrial space with other uses or stacking them in the same building uses precious urban land efficiently and provides jobs and homes where most needed. This is a key policy in the London Plan, and the capital’s first example will open this year: Industria in Barking will have 133,000 sq ft of industrial units of various sizes, a public café and meeting rooms over four storeys.
Co-locating industrial space with other uses can use urban land efficiently
This doesn’t sound like a natural combination, and brings additional planning and development complications. Extensive and early due diligence is required to minimise the potential negative impact of each asset class on its neighbours.
A review of the accommodation mix is needed: are homes for single occupants or families, for owners or renters? Are large suppliers like Amazon, or smaller, last-mile delivery firms being targeted as tenants? Is the building completely new or renovating an old facility?
These variables affect design, specification and delivery. Planning authorities will want to look closely at the visual impact on residents, and the effects of vehicle movements and round-the-clock operations, and develop mitigation strategies.
None of this is unmanageable. And while these particular asset classes have not been mixed before, others are routinely combined, with similar challenges: at Wembley Park, Quintain is building thousands of homes next to a stadium that hosts 60 to 80 major events a year.
Beyond expanding site supply, industrial intensification brings other opportunities. What if those amenity spaces didn’t just offset the impact of the industrial activities, but actively complemented them? By opening facilities to residents, they could access new income streams and become anchors for new kinds of communities. Bringing these businesses closer to people forces them to become better neighbours, accelerating the transition to cleaner, greener transport forms, with positive effects for urban environments. In return, industrial developers and occupiers would enjoy a warmer welcome from planners and local stakeholders.
Once there is a proof of concept and people can see it works, the possibilities are endless; life sciences or healthcare facilities could be added to the mix. Living next door to a distribution centre might not be a desirable option today, but I wouldn’t bet against it for the future.
Giles Heather is a director at Linesight