Rents continue to be robust and in many locations are rising across the South East industrial market, according to SHW’s Q1 2024 South East Industrial Focus. Tim Hardwicke, SHW’s Partner and Head of Agency, comments: “On the whole, 2023 saw a good level of take up in most areas across the South East, across all size ranges, with lower take up levels generally in locations where availability of good quality stock is restricted. As expected, the majority of demand is linked to logistics / B8, rather than B1 manufacturing, however this sector did slowdown in 2023 compared with 2022 and the larger (over 75,000 sq ft) size range also saw a reduction in demand and resultant transactions. “Rents continue to be robust despite occupiers pushing back and, in many locations, continue to rise. However, the rate of increase has slowed, albeit incentives have increased marginally.” In Croydon and the surrounding areas, rents have increased from £19.75 per sq ft in 2022 to a highest £21 per sq ft achieved in 2023. Overall take up was on a par with 2022 (450,500 sq ft in 2023 Vs 453,000 sq ft in 2022), with availability rising to 833,000 compared with 670,000 in 2022 (5.58%), due, in part, to Segro’s new development at Mitcham Road in Croydon coming on stream. Logged demand remains high, totalling over 6 million sq ft, pushing up rental levels. Alex Gale, Partner at SHW, says: “2024, and the next 24 months beyond, will see a plethora of new developments coming to the market in this area, including: Prologis Beddington Phase 2; GLI’s twin schemes at Queensway in Croydon and Goat Road in Mitcham, as well as two schemes in Factory Lane Croydon from Bridge Industrial and Chancerygate. This will provide much needed new stock to a market that lacks quality Product in the main.” In Redhill and Reigate, rental levels also increased significantly from £13.95 per sq ft in 2022 to £18 per sq ft in 2023, almost matching quoting rents. This was due, in the main, to lack of stock, and with the only new development – Saltwhistle Business Park – seeing its first letting. Take up more than doubled to 111,000 sq ft (48,000 in 2022), with availability dropping very slightly to 88,500 sq ft. At 3.3% vacancy and with a total logged demand for the year of 1.68 million sq ft, rental levels here should remain robust. The Sutton, Epsom, Chessington and Leatherhead areas again saw an increase in rents up to £21 per sq ft, compared with £17.50 per sq ft in 2022, although take up was only at 25% of 2022 levels (178,000 sq ft in 2022 / 45,000 sq ft in 2023). Availability increased significantly to 228,000 sq ft (85,000 sq ft in 2022), but with a 2.9% vacancy rate and a logged demand of 520,000 sq ft, rents are likely to remain high. Though not as dramatic as other areas, rents rose in Burgess Hill and Haywards Heath by £1.25 per... Read more