Despite wider economic headwinds and recent turbulence in the markets, occupier demand in the logistics sector remains strong. We are seeing a shortage of available stock, with spec programmes continuing across a wider range of size bands – including some of the UK’s largest warehouse facilities.
But as development continues, occupier requirements are evolving. Innovation and efficiency are still high on priority lists, while just-in-case remains a driver for supply chains and nearshoring increases.
That should mean not only more efficient, more sustainable warehousing coming forward as standard, but also opportunities to look more holistically at the movement of goods to and from these assets.
Rail freight, in particular, needs greater recognition as a faster, greener, safer and more efficient way of moving inventory into place.
Each goods train can take up to 76 HGVs off the road, reducing carbon dioxide emissions by as much as 76% and producing up to 15 times less in nitrous oxide emissions. At the same time, the UK’s road networks are under pressure. As well as congestion issues, the older demographic of UK HGV drivers means many are retiring without replacements, while non-UK drivers are now more restricted.
The challenge for real estate is delivering these sites and the complex facilities they require.
At iPort, just outside Doncaster, we recognised this potential early on and made a strategic rail freight interchange central to the 800-acre logistics hub.
At the time of opening, iPort Rail was the first inland freight terminal to be open and operational for a decade, taking 22,520 long-distance HGV journeys off the road in its first year.
Since then, it has become one of a growing number of facilities in the UK able to provide an integrated multimodal service, opening up new routes and markets as well as offering greener supply chain alternatives.
While it initially took some time for occupiers to appreciate the advantages of the rail-freight services on their doorstep, that quickly changed and iPort Rail is now well established, with most of the businesses based there using rail as part of their inbound container journeys.
Subsidiary services ensuring the smooth movement of goods are essential, so providing electric vehicles to transport containers from the rail terminal to facilities across the estate lowers both cost and carbon footprint. Importantly, the terminal is also open to businesses based throughout the area, increasing the flow of goods across the region.
In fact, the growth of services at iPort Rail has been so rapid that we are now considering expanding the rail facility further to meet demand. It has become a valuable business in its own right, as well as an integral part of the wider iPort estate.
So, even though it is encouraging to see more rail developments coming forward, there are still further opportunities for logistics. Greater integration of real estate and rail freight means we can better serve occupiers as their decarbonising agendas move forward, whatever the other challenges on the horizon.
John Clements is executive director at Verdion