Road links proving important

Feb 13 2008 by Graeme King, The Journal

Distribution and warehouse operators looking for locations in the North East continue to focus their attention along the A1 and A19 corridors, say Danny Cramman and Gordon Hewling.

DEMAND for distribution premises in Tyne and Wear is concentrated on the A194(M) and A1231 corridor between the A1(M) and the A19.

Asda’s facility at Washington provides a good indicator of future demand from retailers in this location. Easter’s 9,300sq m (100,000sq ft) shed at Cherry Blossom Way on the A19 is available at £48 sq m (£4.5 sq ft) and several other big-shed schemes are expected to complete this year.

At Follingsby Park, construction of another 18,600sq m (200,000sq ft) of space will complete in September with rents ranging from £50-60 sq m (£4.75- £5.50 sq ft)

The 18-hectare (45-acre) Dunlop site at Washington has been earmarked for big-shed development. Highbridge Developments is already talking to several national distribution and manufacturing companies with requirements between 11,000-23,000sq m (120,000-250,000sq ft).

GVA Lamb & Edge is marketing site 22/12 on the Pattinson Industrial Estate adjacent to Asda. This five-hectare (13-acre) site is ideal or big-shed development and will be sold by way of a development agreement.

West of Newcastle, Caddick is due on site for the construction of a mixed industrial and office development at Newburn Riverside, which will include sheds of up to 2,800 sq m (30,000 sq ft).

In a new move for the North East, UK Land and Newcastle Airport are in planning for 42,000sq m (450,000sq ft) of hangar and warehouse/ distribution space.

This scheme will be built directly adjoining the runway and a new aircraft apron, and will enable occupiers to unload airfreight for transit to the North East’s road network.

Further south, distribution development is clustered between Teesport and the A1. HelioSlough is on site with TV120, 10 units totalling 11,000sq m (120,000sq ft) at Wynyard Park. Asda has developed a £20m import centre at Teesport, and estimates that it will save two million road miles a year by shipping directly to the North East.

Argos Direct has its regional distribution centre at Faverdale, Darlington.

At Seaham on the A19, Cumbrian Holdings has taken 12,000sq m (125,000sq ft) of space at a headline rent of £51 sq m (£4.75 sq ft), with Grantside Developments set to build another 12,000sq m (130,000 sq ft) facility alongside.

Average industrial rents in the North East rose by 1.7% in the second quarter of 2007 and are forecast to increase by around 2% per annum over the next five years.

Gordon Hewling is director of the Building and Project Management Consultancy and Danny Cramman is an associate director of the industrial agency at GVA Lamb & Edge.

PAGE TWO: Surge of big-shed developments.