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Logistics space in demand from retail


Retailers accounted for 74 per cent of floorspace taken up in new large-size logistics units in 2010 and industry demand for this space is set to remain constant in 2011, according to property consultancy King Sturge.

In the company’s Property Industry Predictions report, published this week, Partner for Industrial Agency Tim Johnson said that the majority of businesses taking on shed space of at least 100,000 sq ft last year were from retail, with at least 1.7 million sq ft linked to internet operations.

He commented: “Last year, a number of retailers opened new distribution facilities to service their internet operations including both traditional multichannel retailers such as John Lewis and pure play internet only retailers such as Gap Direct,, Amazon, Ocado and

“We are seeing a growing number of warehouse requirements to service internet operations from both categories of retailers.”

King Sturge anticipates that this trend is set to continue in the new year, with an increasing number of retailers reconfiguring or expanding their storage capacity in order to deal with growth in internet sales, as opposed to high street expansion.

The property company’s predictions echo those of Professor Joshua Bamfield, who told Retail Gazette this week that more retailers will be focusing on developing their online operations in 2011.

He said that a switch of attention to e-tail, combined with pressures from reduced consumer spending, is likely to result in around 10,000 shops closing down over the course of the year as retailers look to reduce their portfolios and minimise costs.

Bamfield remarked: “A lot of multiples will assess market conditions this year and may decide to reduce their store portfolios by ten to 15 per cent.”

Published on Thursday 06 January by Editorial Assistant

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