Forsters advises on Joint Venture between Invesco Real Estate and Marchmont Investment Management
14 March 2025
News
Forsters’ Commercial Real Estate team has advised a new Joint Venture between Invesco Real Estate and Marchmont Investment Management in its first acquisition of a portfolio of industrial and logistics assets in strategic locations across the UK.
The new Space Industrial platform has been established to acquire, manage and re-position multi-let assets with a key focus on ESG-credentials, offering value-add opportunities. It has been seeded with funding provided by Marchmont and Invesco Real Estate Europe Fund III to acquire the portfolio comprising four assets in Milton Keynes, Sheffield, Manchester and Pershore.
Forsters’ role included advising the client on all commercial real estate aspects of the acquisition, including carrying out title and tenancy due diligence, negotiating all contractual documents, co-ordinating tax, construction, planning and real estate disputes where required.
As the first four assets to be acquired by the fund, the work incorporated extensive collaboration with the Jersey trust advisors. Subsequently, the properties have been secured against debt finance, necessitating a financing transaction with the firm’s Banking and Finance team.
Cam Fraser, CIO of Marchmont said “The UK multi let industrial (MLI) market has repriced more rapidly than others, presenting an opportunity for Space Industrial to invest in high-quality, income-producing MLI real estate, promising strong risk-adjusted returns. The venture will target assets between £10m-£100m and will look to provide capital solutions for Industrial Real estate platforms.”
There are decades where nothing happens; and there are weeks where decades happen – the changing landscape of the logistics sector
7 March 2025
News
Beginning a summary of a conference with a quotation from Lenin was not something I thought I would be doing this year, however, as one panellist mentioned at this conference, this quotation encapsulates the current landscape of the state of the globe and the industrial and logistics sector is one of the few truly global sectors.
The Property Week’s Industrial & Logistics conference is always a perfect opportunity to gain and share insights in respect of what challenges the future of the sector faces. This year Magnus Hasset, Vicki Towers and I attended the conference. – The following are some of the key takeaways:
Planning
As any intrepid traveller within the sector will know, planning is never too far away from discussions when it comes to industrial and logistics. Maybe it was fitting that this year the conference was held in a new location where the Palace of Westminster loomed large in the background. With Government Policy Shake Up being the first panel event of the day, it demonstrated the important role that that government, and indeed planning, play in the future of this sector.
In short, the sector appears encouraged by the introduction of the “grey belt”, albeit with scepticism as to how this will evolve in relation to the green belt for industrial and logistics, especially as it appeared there were ‘subjective’ tests for such developments (as opposed to the more ‘objective’ tests assigned to residential developments).
As you might expect, there was continued dissatisfaction with the planning process as a whole with complaints surrounding different approaches taken by local authorities and the absence of any real “carrot” or “sticks”. Streamlining of the planning process is a theme that is broached each year and does not appear to be something that is going to change anytime soon.
Global trends
Macro and geopolitics are having a longstanding and sustained impact on the sector, . One area where this is having a profound effect is decision making. The predicament is causing higher costs but also making the decision process take longer. This has a knock on effect in respect of leasing voids and locations, with companies looking to near/on shore their facilities.
Power
Everyone is electrifying – indeed Maersk, for example, have started to electrify some of their fleet. What this means is that power is a crucial factor for any logistics & industrial stakeholder and one that will only continue to increase in importance.
Accordingly, power, or lack thereof, was another major theme for the conference. Experts were keen to stress that lines were not running “hot” – in fact, for example, UKPN are only at 60% capacity (although it was admitted that much of the technology was outdated). The real issue was in respect of queuing, with a number of “zombie projects” slowing up the process,. It was stressed, however, that capacity that had been allocated was starting to be rescinded if deemed to be ‘non-starters’.
It is clear that power – how to get it, what type, how quickly, at what cost – will continue to dominate the sector for years to come.
Sustainability
Intrinsically linked to power is sustainability – another overarching theme to the conference.
This angle has, and will continue to, come under increased scrutiny in light of America’s recent zeitgeist changes. This appears to have led major companies, such as BP moving away from renewables, to shift away from their sustainability targets. Whether the UK will start to follow suit, only time will tell.
An example of the drive to continue sustainability in this country is PV panels on rooftops – a project that is being championed by the UKWA (although it had hit some road bumps as parliament changes from blue to red). Warehouses with PV panels on roofs make up only 5% of the total warehouse rooftop space. It was clear that the low number was not due to a lack of appetite, or grid capacity, but because of the regulations and the amount of applications holding such items back.
In respect of CO2 emissions, the construction industry and the built environment has a large role to play in the reduction of carbon emissions given that they make up around 40% of total emissions. Most of this comes from the operation of the building, however a large element comes from ’embodied carbon’ – emissions as a result of material manufacturing, demolition etc. To achieve a reduction of the same it was clear that many elements have to be embraced by the industry such as; engaging early at the design stage; using, where possible, the circular economy; focusing on what materials were used (such as recycling concrete and steel); and collaborating with suppliers.
Postives?
Were there any? Yes. Despite the challenges above, growth still appears evident with normalised levels, if COVID peaks are ignored. E-commerce is still a driving factor of the logistics sector and one that does not appear to be slowing – especially when the “grey revolution” is taken into account, not to mention the ever increasing UK population.
Trump’s policies look set to have a positive impact on the defence sector with defence spending recently announced to be increased to 2.5%, at least in the short term. BAE Systems and the MoD have recently taken manufacturing space and this looks set to accelerate (which, in itself, highlights the diversification of occupiers of industrial warehouse space).
In short, the logistics sector is still grappling with many of the challenges that it has faced over the previous years with more appearing on the horizon. As mentioned above, the logistics sector is a vital sector that needs to grow and adapt to continue providing this essential service. Thankfully, it does appear that the sector looks poised to do so.
In the fourth episode of our Outside the Box podcast, we focus on the occupational requirements within the industrial and logistics sector. How has occupier demand changed during 2023 and, with an increasingly diverse occupier mix, is the industrial and logistics sector addressing the needs of occupiers? Paul Grayson, Senior Associate at Fosters chats to Tom Shaw, Director in the industrial and logistics occupier advisory team at Savills.
Forsters advises Fiera Real Estate UK and Wrenbridge on the acquisition of an urban logistics development site in Waltham Cross
15 December 2023
News
Forsters has advised Fiera Real Estate (“Fiera”) and Wrenbridge on the acquisition of a 2.6-acre site in Waltham Cross for the proposed development of a new 60,473 sq.ft. urban logistics scheme with a GDV of £25m.
The site was purchased through the Fiera Real Estate Logistics Development Fund UK (“FRELD”). All assets in FRELD’s portfolio will meet the rigorous environmental and social requirements set out by FRE UK’s Sustainable Design Brief, which align with its ambition to drive positive change and contribute to a low carbon economy. The scheme will have ESG considerations embedded at all stages of its design process and along with future projects for the fund, it will be targeting net-zero carbon construction, BREEAM Excellent and EPC A.
The site is situated off Britannia Road in Waltham Cross, which is a prime industrial location and two miles from junction 25 of the M25.
Chris Button, Head of Investment Management, UK at Fiera, said, “We are delighted to complete the acquisition of this prime logistics site in joint venture with leading developers Wrenbridge and ably advised, as always, by the magnificent team at Forsters.”
Harry Gibson, Associate Director at Wrenbridge, added: “This is our third deal locally and we look forward to preparing a planning application in the new year to be on site as soon as possible.”
Commercial Real Estate Partner, Jade Metcalf, led on the purchase, assisted by Senior Associates, Alexandra Ringrose and Daniel Steele, and Planning Associate, Sophie Smith. Property Litigation Partner, Ben Barrison, also advised on the deal.
In the third episode of our Outside the Box podcast, we look at sustainability in the Industrial and Logistics sector. Miri Stickland, Forsters’ Head of Knowledge is joined by Victoria Towers, Partner at Forsters and Co-Head of Industrial and Logistics, and Jessica Pilz, Head of Sustainable Investing, Private Markets at Fiera Capital.
With the sector committed to meeting net zero targets by 2050, UK investors and developers have highlighted the need for further assistance from Government. We discuss how recent announcements from Rishi Sunak weakening net zero policies will impact the sector, how pressure is mounting and where meaningful gains can be made.
In the second episode of our Outside the Box podcast, we look at market challenges and opportunities in the industrial and logistics sector. Miri Stickland, Forsters’ Head of Knowledge, is joined by Magnus Hassett, Partner and Head of Industrial and Logistics at Forsters, and Ben Sleath, Equity partner at DTRE
In early 2023 businesses were recovering from a turbulent political period and much uncertainty remained. Had inflation really peaked? How much would interest rates rise by? Our research report from Spring 2023 (Outside the Box – Supporting an Industrial Evolution) revealed the general sentiment seemed to be that the warehouse bubble had burst, but the jury was out as to whether the industrial real estate sector faced a sustained downturn. The report also identified a range of opportunities across the UK market, and as we know, sometimes the greatest opportunities arise from facing the greatest challenges. In this podcast we discuss how has the industrial and logistics market has progressed in 2023 and Ben Sleath shares his views on occupier demand and rental growth and where the opportunities might be in 2024.
Forsters acts for Bridges and Wrenbridge on the preletting of three logistics units in Aylesford
27 October 2023
News
The Industrial and Logistics team at Forsters has acted for longstanding clients Wrenbridge and Bridges Fund Management on pre-letting of three units at ‘Click Aylesford’ (as reported in React News). The pre-letting comprises 95,000 sq ft of the 300,000 sq ft scheme, where practical completion is expected in summer 2024.
One of the units has been pre-let to FixFast on a 10-year lease, and the other two units have been pre-let to Headline Filters on a 25-year lease. The development is targeting EPC A+ and BREEAM Excellent ratings. The occupational arrangements are aligned with the Wrenbridge/ Bridges aspiration to develop and operate “some of the UK’s most sustainable industrial buildings”.
A multidisciplinary team (Commercial Real Estate, Construction, Planning and Tax) continues to act on matters relating to the development, having acted on the original acquisition in Autumn 2022.
Victoria Towers, Co-Head of the Industrial and Logistics group, said: “We are delighted to continue our relationship with both Bridges and Wrenbridge as they bring forward a highly sustainable logistics portfolio – including working with their prospective occupiers to ensure arrangements are fit for an increasingly ESG-focused future.”
Victoria Towers, assisted by Commercial Real Estate Senior Associate, Edward Glass, Construction Partner, Sarah Cook, Construction Senior Associate, Dan Burr, and Construction Associate, Lauren Hepburn, advised on the deal.
Navigating the Last Mile: Insights from the Last Mile Industrial and Logistics Conference 2023
18 October 2023
News
On October 12, 2023, logistics and warehouse specialists, developers, funders, planners and, notably, a commercial real estate and a construction lawyer from Forsters, converged at the iconic BAFTA venue in London for the Last Mile Industrial and Logistics Conference.
Dan Easom, my construction colleague, and I had the privilege of attending this informative event. We went with an aim of exploring the latest developments and challenges facing industrial and logistics in London and the South-East and, quite frankly, this one article will not cover half of what was discussed. We share some of the key takeaways from the conference.
State of the Market
Through the many graphs and figures that were shown and discussed, a key point to note was that occupier demand, although showing signs of cooling, continues to favour landlords. The real headline, however, is the aging infrastructure in London where a startling 65% of warehouse space is over 30 years old. Combining this with a notable drop in new construction projects compared to the previous year shows that this problem is not going to be alleviated any time soon.
Another emerging trend in the market is the growing importance of Energy Performance Certificates (EPCs). Occupiers are increasingly willing to pay a premium for A and B-rated buildings, reflecting the industry’s commitment to sustainability and the target for an EPC rating of B by 2030.
Planning for the Energy Infrastructure
An overarching theme of the afternoon was energy – how much do stakeholders need, where do they get it from, and, crucially, what to do with it one it is generated (can they sell or it or store it efficiently?). The electrification of vehicles, the rise of robotics in logistics and warehouse operations, and the proliferation of personal electric vehicles are driving up demand for electricity and this, in turn, increases the need to find practical solutions to solve energy creation and storage needs, let alone ensuring that necessary infrastructure (such as EV charging) is incorporated into developments.
The discussion around renewable energy sources, particularly photovoltaics (PVs), was robust. It’s puzzling that only 5% of warehouses have embraced PVs, given their cost-effectiveness, with the cost paid off within three years. The main hurdle appears to lie in obtaining permits to sell excess energy back to the grid, a bureaucratic process that is fraught with uncertainty. There was anecdotal stories of some developments having even been stalled due to these challenges.
The need to revise the planning process and eliminate restrictions on PVs and renewable energy installation became clear. Local authorities should incorporate energy plans into their development strategies, and the possibility of moving from a centralised power grid to localised grids was discussed. Such local grids, however, are unlikely to be feasible without advances in battery technology and planning ahead to ensure that there is sufficient space on site for the installation of such batteries.
Ultra-Urban Logistics
Navigating logistics in ultra-urban environments is a complex puzzle. Electric vehicles are a step in the right direction, but continuous innovation is imperative. The overarching theme is collaboration and data sharing. Comparable, industry-wide data should be collected and perhaps mandated, with the potential for machine learning applications to drive further improvements.
The idea of reducing door-to-door deliveries in favour of centralising spaces for local businesses was pondered. The West End’s unique property landscape poses limitations for installing such spaces, but this challenge must be addressed in both new developments and retrofits.
A powerful and memorable quote of the day was “the best logistics mile is the mile not travelled”. While ultra-urban logistics has its challenges due to the nature of the existing environments, choosing the right places to build warehouses and focusing on increasing efficiency and reducing unnecessary travel should provide for streamlined logistics and reduced carbon use for all stakeholders.
The conclusion? London urgently needs a comprehensive logistics plan, at the local and national government level, that focuses on logistics and warehousing site allocation, energy demands, and energy capacity.
Making it Sustainable and Maximising Space
Sustainability was a recurring theme, not only in terms of achieving net-zero carbon but also in addressing embodied carbon. The significance of steel and concrete emissions, responsible for 16% of global emissions, was highlighted. There’s a growing interest in traditional materials like bricks and timber, with lower carbon footprints and long-lasting qualities. While this might result in an increase in development costs, the status quo is unsustainable.
Properties that can cater to different types of occupiers is becoming a key consideration for developers. An easy way to provide for such varied uses such as robotics, logistics, vertical farming and film and tv studios is simply to try and maximise the space that is available, as more space allows for more flexibility and adjustability.
Vertical development and underground construction were discussed as ways to optimise space. However, while increased space might mean more flexibility, it was emphasised that these approaches should be demand-driven, requiring collaboration among occupiers, developers, and landlords.
Regardless of the approach taken, these ambitious ideas depend on reliable power sources (energy being a common theme throughout the day).
Creating a Logistics Pipeline
London’s historical stock of properties is a valuable but challenging resource. The task is to determine whether to demolish and develop, retrofit, or repurpose. The goal of achieving EPC rating B for all commercial buildings by 2030 further compounds the problem as it raises questions about the feasibility of retrofitting some of the historical stock.
Each property site demands a unique approach, considering the site’s specifics, location, and existing structures, but balancing financial and carbon costs is essential, as sustainability goals need to be aligned with the economic realities.
One key takeaway is that old doesn’t necessarily mean obsolete, provided it’s adapted thoughtfully to meet modern demands. Moreover, any new developments should be forward-looking, designed to accommodate future technological advancements and to withstand the test of time.
Outside the Box – Episode 1 – The Future of Freight
25 September 2023
Podcasts and videos
In Q1 2023 we quizzed investors and developers on the key issues affecting the industrial and logistics sector and the resulting research report, Outside the Box, set out what we characterised as an ‘industrial evolution’.
In this series of podcasts, we explore the sector’s key issues in more detail and discuss with some well-informed guests.
Episode 1
In our first episode, Magnus Hassett, Partner at Forsters and Co-Head of Industrial and Logistics, is joined by David Elvy, Head of Future Freight Strategy at the Department for Transport, and Matthew Evans, counsel in Forsters’ Planning team. Together, they take a closer look at the Department for Transport’s Future of Freight plan, with a particular focus on the role and impact of the planning system.
The scale of the UK’s freight and logistics sector is enormous with 1.6 billion tonnes of goods transported in and around Britain each year. Recognising the importance to the country of moving goods efficiently, in 2022 the Department for Transport published its Future of Freight plan. Developed in partnership with the UK’s freight and logistics industry, the plan sets out the Government’s long-term vision for UK freight, identifying some key challenges and objectives for the sector.
Logistics needs to reach a more diverse talent pool – Victoria Towers writes to Property Week Editor
4 August 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial and Logistics group, Victoria Towers, has written to the Editor of Property Week on how “the recent announcement that the Generation Logistics campaign, which aims to improve recruitment and retention in the logistics workforce, securing another year of government funding is welcome news for the sector, where there remains a critical need to expand the labour pool.”
Towers writes: “Based on independent research we recently commissioned, investors and developers active in industrial and logistics real estate cite availability of labour as the third most significant factor – close on the heels of connectivity and value – in deciding where to invest.
“Encouragingly, this year’s Department for Transport funding is to focus on raising the profile of logistics in schools and colleges, which chimes with the wishes of investors and developers, who responded to our survey calling for careers advice alongside talks in schools and the promotion of training.
“Our study found potential for the sector to make itself more attractive to a diverse talent pool, highlighting that the rise in last-mile logistics should support more part-time roles in daytime hours for those with family commitments. Automation was thought likely to lead to a gradual change in the nature of careers, increasing the need for engineers and technicians.
“The sector needs to both demystify its operations, promote the diversity of opportunities and reach a more diverse talent pool. Youngsters need to understand this isn’t simply an industry of long-distance lorry drivers, away from their families for days at a time.
“This is a truly nationwide sector, looking to be in easy reach of every home and business in the UK. The industry needs to reach a lot of schools and colleges. Even with contributions from industry, this year’s government funding of £300,000 will be stretched thin and more needs to be done to tackle the issue.”
To explore more of our ‘Outside the Box’ research, please click here.
This letter was first published by Property Week on 3 August 2023 and can be read here (behind their paywall).
Forsters advises Fiera Real Estate and Wrenbridge on acquisition of Heathrow logistics scheme
16 June 2023
News
Forsters has advised Fiera Real Estate (“Fiera”) and Wrenbridge on the acquisition of a site 1.5 miles from Heathrow airport for £60m.
Acquired from residential developer, Stonegate Homes, the plan is to develop a 110,570 sq ft urban logistics scheme, comprising of three units ranging from 22,131 sq ft to 58,127 sq ft.
The site will also be targeting an EPC rating of A+ and a BREEAM Excellent rating.
This deal is the fourth to be completed by the Fiera Real Estate Logistics Development Fund UK, which has roughly £200m left with which to invest in similar schemes across the UK.
Fiera fund manager Chris Button commented the development would deliver “much needed, sustainable, high-quality urban warehousing.”
Commercial Real Estate Partner and Co-Head of the Industrial and Logistics group, Victoria Towers, says: “We are delighted to continue our close relationship with Fiera and Wrenbridge by advising on the acquisition of this site, which will bolster the South-East’s sustainable warehousing credentials.”
Victoria Towers, assisted by Senior Associate, Paul Grayson, advised on the deal.
Evolving industrial and logistics sector finds reason for optimism – Victoria Towers speaks to Property Week
26 May 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial & Logistics group, Victoria Towers, has spoken to Property Week on Forsters’ survey, conducted for our recent ‘Outside the Box‘ campaign, on current market sentiment within the Industrial and Logistics space.
Towers says: “Investors are confident of long-term occupier demand and of overcoming construction risk as inflation peaks.
“So much is changing so quickly, and the sector is definitely having to adapt more than it has previously. The sector is innovating and continues to show resilience.”
To find out more about our ‘Outside the Box’ campaign and explore the statistics learnt from our survey, click here.
This article was originally published on 12 May 2023 by Property Week and can be read here (behind their paywall).
Why the logistics sector is under pressure to evolve – Victoria Towers writes for React News
26 May 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial & Logistics group, Victoria Towers, has written for React News on the evolution of the logistics sector and how owners are pushing to innovate and meet sustainability goals.
Towers writes that “[Forsters’] recent Outside the Box study of the expectations of investors and developers in the [industrial and logistics] sector confirms our own experience as lawyers in advising on our clients’ innovations. Multi-storey formats, renewable energy and integration with residential require legal and technological support.”
From the survey, we saw that the greatest consensus was on multi-storey sheds. “77% believe they will play a large role in the UK logistics sector in the future and 52% have seen an increase in developer appetite in the past year.”
The key driver for this is the competition for land, with all that’s missing a confidence in the resilience of this new multi-storey shed format. “Are there cost-effective structural engineering solutions and ways around a vehicle stuck on a ramp? Are goods lifts now reliable enough?” Regardless, Towers says we should expect to see a proliferation of warehouses, light industrial units and the occasional 20-storey tower.
“In the meantime, lawyers will develop the legal structures needed to ensure that a multi-tenanted, multi-storey scheme remains attractive to both tenants and investors.”
The co-location of residential and urban logistics is causing issues in relation to design, technology and legal rights, with classic NIMBYism in play.
The solution will most likely lie with technology, which will also improve prospects for planning. Key forms of technology raised in our survey include clean energy, modernised site infrastructure, air filters and quieter HGV engines. There is also particular optimism for the impact of e-commerce, robotics (67%) and EV charging.
The real cause for excitement is, however, the impacts expected from artificial intelligence. Towers explains that “automation has required tighter legal controls on landlords to avoid them marching in on an inspection and getting in the way of a robot. As we start to see the uses emerging for AI we will get a clearer sense of the legal principles no longer fit for purpose and the gaps in regulation.”
Missing link
Battery storage has been a particular source of debate. Industrial real estate is becoming increasingly power hungry, and the “broad, flat roofs of our sheds are a gift for photovoltaics.”
“Battery storage is the missing link. The industry needs the capacity and ability to retain the energy generated by photovoltaics. If the panels produce excess energy, it is wasted should the National Grid not buy it back and there is nowhere to store it.
“The innovations we have discussed so far could have a big impact on the efficiency, value and deliverability of industrial real estate. But there could be a more disruptive change in the pipeline.”
Towers goes onto highlight the environmental incentive of shifting from road to rail, with particular reference to HGVS. This sentiment is shown in our survey with many anticipating rail freight generating the greatest growth in occupier demand in 2023.
“The picture that emerges is of a sector that is far from complacent in surfing the continuing wave of strong demand and high values. The industrial real estate sector is conscious of pressure to transform its environmental performance, and is investing in the innovations that will deliver a cleaner and more efficient industry.”
To find out more about our ‘Outside the Box’ campaign and explore the findings of our survey in detail, click here.
This article was originally published on 22 May 2023 by React News and can be read here (behind their paywall).
Major survey of investors and developers reveals growth opportunities in evolving industrial real estate market
11 May 2023
News
Extensive independent research commissioned by law firm Forsters reveals key growth opportunities as the industrial and logistics real estate sector adapts to market and policy pressures.
Forsters’ report, Outside the box: supporting an industrial evolution, is based on a survey by FTI Consulting’s professional research team in the first quarter of 2023. Sixty-one UK-based professional investors and developers in UK real estate assets were surveyed and another four leading developers and investors were interviewed about their experiences in competing for land, investment and occupiers while adapting to the shifts taking place in uses, formats, locations and policy.
Markets and demand
The ‘warehouse bubble’ has burst for 77% of the sector, but almost half (46%) expect an increase in asset values and rental levels in 2023 and a smaller proportion (39%) believe there will be an increase in occupier demand.
Urban logistics and last-mile real estate are expected to experience greatest demand in 2023. As last-mile delivery centres move closer to residential areas, the sector acknowledges the need to be neighbourly. Around half say that running HGVs on clean energy (46%) and creating a modernised site infrastructure (46%) will help co-location and planning permission.
The research suggests some mismatch between future investment development. There is a higher demand from investors than developers in transport and logistics (49% investors, 36% developers), retail (28% and 15%) and post and parcel delivery (26% and 18%). Where there is higher demand from developers than investors, the result could be a lack of finance for speculative development. Uses most affected would be data centres (25% investors and 38% developers) and food and beverage (31% and 38%).
Advocates of modal shift from road to rail will be heartened to see rail come top for its prospects: 51% believe rail freight will generate the greatest growth in occupier demand in 2023, compared with 33% for both road and maritime.
Greater London is seen as offering the best prospects for investment by 28%, followed by the North West (13%), South East (11%) and West Midlands (11%). Those who selected Greater London were mainly driven by its connectivity (47%), availability of assets (35%) and availability of supply (35%). Across all regions, the key factors for investors were connectivity (51%), closely followed by good value (49%) before a large gap to availability of labour (30%).
Innovation
Competition for land continues to drive interest in multi-storey industrial development: 52% have seen an increase in developer appetite in the past year and 77% believe that multi-storey sheds will play a large role in UK logistics in the future.
Investors and developers were optimistic about the impact of technologies, such as e-commerce (69%), robotics (67%) and electric vehicle charging (67%), and saw the most significant positive impact coming from artificial intelligence (33%) which trumped e-commerce (28%). AI was also seen as most likely to have a negative impact (15%).
Sustainability
The industry highlighted the need for assistance in meeting net zero targets. Key asks were government subsidies for renewable energy (54%), assistance with measuring progress (34%) and expert guidance (26%). With growing pressure for refurbishment, 57% said that cost is an issue, while 34% highlighted the extent of refurbishment required and around a quarter blamed inadequate structures (26%) or the quality achievable through refurbishment (23%).
Smart meters (57%) were most popular as a means of improving the sustainability of existing developments, followed by additional insulation (51%), while 77% of respondents currently use solar panels or plan to. Although only 18% currently use battery storage technology, a huge 51% are planning on using it.
When it comes to incentivising tenants to reduce energy consumption, 39% advocate the use of smart meters as part of a reciprocal agreement. Only 26% of respondents see green lease provisions as the most effective incentive to offer a tenant.
Forsters partner Victoria Towers comments, “Investors are confident of long-term occupier demand and of overcoming construction risk as inflation peaks. What this national survey reveals is huge diversity in not only the opportunities but also the responses to them.
“The sector is innovating and continues to show resilience. The pioneers will need legal innovation to keep pace. Lawyers must help manage the development and use of space looking to the long term to preserve asset value in schemes. This should include supporting a collaborative relationship between landlords and tenants to achieve environmental and social sustainability objectives.”
Forsters advises Fiera Real Estate UK and Cubex on the acquisition of a 2.6 acre development site in Bristol
27 April 2023
News
Forsters has advised Fiera Real Estate (“Fiera”) and Cubex on the acquisition of a 2.6-acre site in Filton for the proposed development of a new 75,000 sq.ft Grade A urban logistics scheme with a GDV of £20m. The scheme is expected to complete in the second quarter of 2024.
The site was purchased through the Fiera Real Estate Logistics Development Fund UK (“FRELD”). All assets in FRELD’s portfolio will meet the rigorous environmental and social requirements set out by FRE UK’s Sustainable Design Brief, which align with its ambition to drive positive change and contribute to a low carbon economy. The scheme has had ESG considerations embedded at all stages of its design process and along with future projects for the fund, it will be targeting net-zero carbon construction, BREEAM Excellent and EPC A.
The site is situated in the Filton area of Bristol, which is already a prime industrial location and in close proximity to the M4, M32 and A38. It was previously occupied by Rolls Royce before being acquired by St Francis Group and is the last remaining plot of the Horizon 38 development, which already hosts several investment grade occupiers.
Joe Downey, Managing Director at Cubex, commented “I absolutely love this site. Filton is undoubtedly the best-connected location in Bristol for urban warehousing. The immediate area is home to some of the largest aerospace and defence companies in the world, and the neighbouring Brabazon development will create an entirely new neighbourhood with thousands of new homes.”
Chris Button, Fund Manager at Fiera, added, “We are super excited to be funding another high quality and sustainable development with Cubex and have immediate appetite to invest a further £250m.”
Commercial Real Estate Partner Jade Capper, assisted by Senior Associate Charlie Croft, advised on the deal.
BISNOW Seminar – The UK’s Industrial and Logistics Transformation
21 April 2023
News
On Tuesday 18 April 2023, Commercial Real Estate Senior Associates Daniel Steele and Paul Grayson attended the BISNOW seminar on The UK’s Industrial and Logistics Transformation at the Royal College of General Practitioners.
The seminar focused on two key themes:
Investing In Industrial: Is The Bubble Going To Burst? and
The Future Of Industrial: Sustainability And Technology,
as well as a general discussion regarding the green industrial revolution. The speakers came from a variety of backgrounds, including international investment managers, UK big-box developers, London-focused developers, real estate consultants and a representative of the UK Warehousing Association.
Daniel and Paul share some key insights and thoughts from the various discussions as follows:
Wishful thinking
When each asked one thing that the panellists wished would happen in the next 12 months, pleas for changes to the planning system, for market participants to adjust their expectations and for a move towards adopting multistorey industrial options were all mooted.
It was widely acknowledged by panellists across the afternoon that the current planning system does not appear to be working and changes need to occur in order to make this more transparent and consistent across the UK.
Some market participants still appear to be clinging to memories of before the Liz Truss mini budget in September 2022 and are not adjusting their expectations. While prices are slowly adjusting to realistic levels, the panellists believed that there has been a structural change in pricing that should be accepted and built upon, rather than relying on prayers and hopes of what has happened historically.
Multi-storey developments are common in Europe but UK occupiers appear to be slow to adopt this. Given the demand for space multi-storey options should be considered by tenants as viable options to their needs and should be encouraged by agents to increase uptake. That said, the panel did acknowledge that occupiers will not fully commit to multi-storey developments until it can be widely demonstrated that the ramps/lifts between floors can adequately sustain the demands of industrial use.
High Voltage
While there is a push towards adopting green energy and adapting operations and assets to avoid the use of fossil fuels, there is concern as to whether the grid has the capacity to tolerate increased energy consumption. To mitigate future energy concerns, many developers and landlords are opting to put solar PV panels on their buildings but there are still questions regarding how (and if) excess capacity can be returned to the grid and at what return? Is there enough incentive to developers or landlords to install solar PV panels if the tenant does not have any need for excess power and the energy cannot be sold back to the grid at a reasonable rate?
i-Robot
Many tenants are investing in robotics and are leaving room in their plans to accommodate expanded robotics schemes in the future. The UK market, however, faces issues in attempting to expand robotics, such as:
as mentioned above, does the UK have the energy capacity to cope with this? and
are there enough engineers in the UK to service them?
A panellist described an example of an entire automated facility shutting down and having to wait for an engineer from Europe to fly over and fix the situation. Should the industry be offering apprenticeships so that the UK can train their own engineers to facilitate the expanding growth of robotics in industry?
Mixing it up
The rise of dark kitchens, vertical farms and film studios occupying warehouse space all offer opportunities for access to new tenants and therefore new growth and demand, particularly for urban and last-mile logistics sites (assuming the sites have the energy capacity to cope with tenant’s requirements – film studios are energy hungry!).
ESG and benchmarking
Whilst the market is rightfully driving the ESG agenda, there is still no commonality as to what “net zero” means. Each market participant is undertaking their own ESG initiatives, however the lack of commonality makes it difficult to benchmark one’s performance against others in the market. The market needs to be more transparent as a whole, perhaps an alien concept to investors and developers who closely guard key information such as yields.
Lockton Property Issues Seminar – overview of the UK industrials and logistics market
22 February 2023
News
On Wednesday 22 February 2023, Commercial Real Estate Senior Associate Paul Grayson attended the Lockton Property Issues Seminar at Lockton’s offices at The St Botolph Building, 138 Houndsditch, London.
As part of the Property Issues Seminar, Kevin Mofid of Savills provided an overview of the UK Industrials and logistics market. Paul shares his key takeaways from this overview as follows:
Logistics take up remains high – 2022 was the third highest year in history for logistics space take up (with 47 million square feet of space been taken up). 2021 was the highest ever year, closely followed by 2020 (noting that in both 2020 and 2021, take up exceeded 50 million square feet). 2022 may have represented a seemingly sharp drop in take up, however this is only when comparing 2022 with the “Covid amplification years” of 2020 and 2021;
Regions are generally outperforming the long term annual average in terms of uptake – when looking at the data from 2022 as against the long term annual average for uptake, most regions are outperforming the long term annual average. For example:
The East Midlands is 40% above the long term annual average;
Yorkshire is 75% above the long term annual average; and
The North West is 69% above the long term annual average.
In contrast, the South East is currently 17% below the long term annual average. This perhaps reflects the lack of availability of stock in this region, as well as sustained rental growth;
A potential opportunity for second hand stock – in 2022, only 22% of take up was for second hand stock. In comparison, 50% of take up was for “build to suit” buildings. This perhaps reflects a flight to quality, however due to the rising cost of debt, build to suit schemes are becoming harder to fund. This may lead to an increase in demand for existing buildings;
The EPC timebomb for second hand stock – in contrast, a number of existing warehouse buildings risk becoming stranded assets due to the upcoming changes to the minimum standards required by the MEES Regulations. 90% of warehouses in the UK below 100,000 square feet currently have an EPC of C or below;
The supply chain faces multiple challenges – the supply chain faces numerous global challenges in the future. For example:
Chinese labour costs have risen by 250% since China joined the WTO in 2001;
One quarter of global trade is carried out with high-risk countries; and
International trade accounts for 20 – 30% of global emissions.
Manufacturing uses on the rise – 2022 saw the highest amount of warehouse space ever taken up in relation to manufacturing uses such as life science R&D, automotive production and battery production; and
The logistics sector will always be in demand as it is a necessity – despite challenging economic conditions, the logistics sector will continue to be the backbone of the country. Warehouses should be viewed as places of national infrastructure which are absolutely necessary in order to keep the country moving.
A tale of two halves… – Victoria Towers speaks to Logistics Manager
9 February 2023
Views
“The disconnect between the industrial logistics investment market and the industrial logistics occupier market seems to be at its greatest, following a tumultuous year but what does this mean for occupiers going forward?”
Partner and Co-Head of Industrial & Logistics, Victoria Towers, has provided expert commentary to Logistics Manager magazine on the growing discrepancy between the sector’s occupier market and investment market; how the former remains strong, but the latter has nosedived.
Towers describes how “We started the year [2022] in a beautiful world of high demand and a buoyant supply pipeline. Focus was on forward fundings, which meant funds were willing to pay handsomely for land in advance of development starting on site. Developments progressed well and contractors were robust. It was a market that seemed to be delivering for developers, funders, and tenants alike.”
The article, which includes additional commentary from other leading figures in the Industrial & Logistics sector, summarises the impact on the market of global factors such as the pandemic and Russia’s invasion of Ukraine, the increased cost of borrowing and the likelihood of a resultant slump in occupier demand. The article concludes with a look to the year ahead; 2023’s forecasted recession and prospective periods of both difficulty and opportunity for occupiers.
This article first appeared in the February 2023 edition of Logistics Manager magazine, it is available here.
Electric Dreams – Victoria Towers speaks to Property Week
30 November 2022
Views
Co-Head of Industrials & Logistics, Victoria Towers, has spoken to Property Week about the aim of warehouse developers to get ahead of the game by installing charging facilities for electric HGVs and vans, as well as investing in solar power.
In light of the statistic that 16% of the UK’s domestic transport emissions come from HGVs, many warehouse developers are looking to increase the current percentage of electric vehicle (EV) charging provision, which currently stands at around 10% of parking spaces.
While the sale of new petrol and diesel cars will be banned by 2030, new petrol or diesel HGVs will not be banned until 2040. Nevertheless, eHGVs are gaining momentum.
Towers commented: “The new shed developments we’re seeing all have EV charging provision for cars and vans and the bigger players are starting to secure warehouses with provision for HGVs. We expect other businesses to follow suit, especially as restrictions and extra charges come into force in towns and city centres to deter the use of petrol and diesel vehicles.”
This article was first published in Property Week on 25 November 2022 and is available to read in full here, behind their paywall.
Key Takeaways – Nicola Copsey attended the ‘Current Trends in Sheds and Industrial Developments’ webinar
24 November 2022
News
Commercial Real Estate Senior Associate, Nicola Copsey, attended the ‘Current Trends in Sheds and Industrial Developments’ webinar. The event described the most recent movements in the industry. Below are her key takeaways:
To help slow my heart rate after the shock defeat of Argentina at the hands (or rather feet) of Saudi Arabia and the damaging effect that has had on my fantasy football team, I dialled in to the webinar on Current Trends in Sheds and Industrial Developments, where the speakers were Lesley Males, Chris Hobday, Tom Malcolm Green and Mat Rogers from Avison Young. Little did I know that the shocks would continue! Here is a short summary of the webinar.
Demand
The demand for Big Box space (over 100,000 sq ft) remains strong but has declined compared to last year. By the end of 2021 there had been take up of over 50 million sq ft of grade A Big Box space, and we will not surpass this in 2022
The demand is driven by a critical lack of supply
Take up of grade A Big Box space is highest in the East Midlands, followed by the West Midlands, given its strategic location (within a 4 hour drive of much of England)
In London, levels of take up in 2022 are 50% of those seen in 2021 (partially due to a lack of supply)
3rd party logistic providers dominate take up, largely due to the increase in online shopping which escalated during the pandemic. Although retail sales are declining, especially over the past few months due to the cost of living crisis, the requirement for space by 3rd party logistic providers will continue as internet sales as a percentage of total retail sales are expected to hit 30 – 35% in the coming years
Type of Property
Design and Build (compared to existing builds and speculative builds) has an increasing share of the take-up for 2 key reasons:
Occupiers are becoming more specific in their requirements for space, especially as the importance of ESG increases
Speculative builds are becoming more expensive because of the increasing costs of materials and labour. Some developers aren’t committing to lettings until buildings have PC’d due to uncertainty over costs
Lack of Supply
There is only 24 million sq ft of grade A Big Box availability nationwide
52% of this supply is under construction
The critical lack of supply is expected to continue into 2023 and is causing reduced occupier take up
Key cause of the lack of supply is the slow planning system, even where a site is non-contentious
Other causes are supply chain and material issues, labour shortages and the costs of getting materials to site
Economic uncertainty
UK investment volumes declined sharply in qtr 2 and 3 2022 because of economic uncertainty. AY reported one purchaser pulling out of a deal post-exchange and forfeiting a deposit of between 12.5 and 25 million pounds
However cash buyers who don’t need to rely on debt may be able to take advantage of a slow in demand
Overseas buyers may be in a better position due to a weaker pound. The highest levels of overseas investment in 2021 came from North America, and this trend is set to continue in 2023 when overseas investment is expected to be higher than domestic investment
Industrial rental growth is still outstripping CPI inflation and the growth is expected to continue
The speakers were not too concerned by the ongoing economic uncertainty because there is a backlog of demand. So even if some investors hold off, there will be others to fill the void
Occupiers wanting to expand are generally holding off at the moment, however other reasons for taking space (i.e. relocation and moving to buildings with increased efficiency in light of energy costs) are still pushing up the demand
Emerging sectors
Vertical farming i.e. the practice of growing crops in vertically stacked layers- due to environmental pressures and population growth, this is expected to be an emerging sector. M&S and Tesco have trialled vertical farming, and there was investment of 800 million USD in 2021 which is expected to grow each year, especially in light of the war in Ukraine
Open storage (e.g. not built upon) – there has been an increase in demand for higher quality open storage (with security and lighting) since the logistic issues caused by Brexit and the pandemic. Enquiry levels in 2022 are already double those since 2021
Data centres- for those with access to the internet, 40% of our waking day is spent online. By 2025 the total amount of data consumed globally is forecast to treble compared to today. The installed base of storage capacity is forecast to increase, growing at a compound annual growth rate of 19.2% from 2020 to 2025. London is the data centre capital of Europe, but some boroughs are out of capacity for the next 8/9 years because of a shortage of power needed to run them. This may encourage an increase in the use of renewable energy sources
ESG
The built environment is responsible for 38% of global emissions and 35% of its power consumption
There is an increasing use of renewable energy, particularly PV panels. Not only does this have a positive environmental impact, but it can create a revenue stream when sold back to occupiers which also benefits occupiers because of the cheaper rates of energy
By 2030, the minimum energy efficiency standard in relation to let non-domestic buildings is set to increase to a B rating. Currently, 90% of properties on the EPC register are below B so there is a huge amount of work to be done by 2030. To upgrade every property on the EPC register to a B rating would cost an estimated £30.5 billion (£334,000 per property)
Part of the issue is that the industrial sector has much older stock compared to retail and office sectors. 40% of industrial stock is 40 years and older, with 8% being built pre-war
On the positive side, the average EPC rating of industrial properties has increased by 3% per annum since 2016 when MEES was introduced
Summary
Strong occupier demand continues but economic situation creating uncertainty
Growing sectors could create opportunity in future years
Retrofitting – out with the new and in with the old
The conference consisted of a number of interesting panel discussions involving key members of the logistics sector, as well as a free trip on the Mail Rail (see photos below)!
In this blog post, he shares his key takeaways from the event.
Current Market Conditions
The developer’s view: Inflation has led to a sharp increase in the cost of materials. Additionally, it is very difficult for developers to forecast pricing in the current market. Developers can only price developments based on today’s information. The current market volatility is requiring developers to make more assumptions than usual when forecasting how much a site will be worth once a development has reached practical completion.
The contractor’s view: The rise in the cost of materials has led to questions as to whether contractors can still deliver fixed price building contracts. The view is that this may still be possible, however it will depend on the type of project and the material selection. The earlier that contractors engage with their customers, the higher the chance that a fixed price building contract can still be delivered. If a fixed price building contract can be delivered, the customer may need to accept a mark-up on the fixed price to reflect current market conditions.
The investor’s view: Pricing is cooling due to the rise in interest rates and inflation. Investors are currently querying whether we have reached the bottom of the market, or if prices will decrease further. This has created a large amount of hesitancy in the market. If investors commit to sites in the current market, it is very likely that the investment decision will be due to the investor believing in the long-term vision for the site (as opposed to making a commitment solely due to pricing).
Delivering ESG
Carbon sequestration: Science is likely to change how buildings are constructed over the next twenty years. There needs to be a shift towards materials which use less carbon, as well as an increase in funding for businesses who are studying how to remove carbon from the atmosphere and holding the same within materials (a process known as carbon sequestration).
Retrofitting: In comparison to other sectors, the logistics sector is unlikely to have a large problem with retrofitting existing stock in order to meet EPC standards. There are a number of ways in which the energy efficiency of a warehouse can be improved, such as the use of LED lighting, increased thermal insulation and the use of solar panels. Solar panels can give rise to fire risks (due to the temperatures that the panels can reach), however the general consensus is that this risk can be alleviated by raising the panels above the roof of the warehouse in order to allow an air flow below the panels.
Ensuring that logistics and residential schemes can co-exist: As logistics and residential schemes move closer together (due to the increase in last mile logistics), efforts need to be made to ensure that these schemes can co-exist. Electric vehicles are required to safeguard air quality in urban areas. From a planning perspective, a masterplan approach can help industrial schemes integrate into local areas. Site layouts and frontages which include green space can make logistics schemes more attractive to local communities.
Diversity and Skills
Demystifying the logistics sector: The logistics sector needs to be demystified in order to make the sector more attractive to a diverse talent pool. Long hours are commonly associated with transportation jobs within the sector. However, due to the rise in last mile logistics, a number of driving roles can now support daytime hours and those members of society who need to maintain both a family and professional life.
Social values: The next generation of employees will overlook a higher salary for a firm which has social values that they share. The logistics sector needs to be better marketed to young people leaving school in order to attract talent from the youngest possible age.
Automation: It should be conveyed to the future workforce that automation will not remove all jobs from the logistics sector. Automation will change the nature of the jobs required and will increase the need for engineers and technicians.
Multi-storey Sheds
Multi-storey vs mezzanine: Warehouses may not need to be fully multi-storey in order to service interested occupiers. A large warehouse with a functioning mezzanine may perform just as well as a multi-storey shed which is serviced by ramps.
Occupier demand: Whilst it is interesting to discuss the architectural challenges/viability of multi-storey sheds, the key question is whether there is occupier demand. Before committing to a multi-storey space, occupiers will want to ensure that the space is resilient and can respond to a goods lift breaking down on the third floor or a HGV breaking down on a ramp between floors. Ultimately, occupiers will only have confidence in multi-storey sheds once such schemes are more common in the UK market.
Functioning spaces: From a developer’s perspective, intensification of space is generally attractive (more lettable floor space results in a higher possible rent). That said, intensification cannot come at the cost of functionality. Large logistics operators will always need large yard areas in order to accommodate HGVs.
Forsters advises a Wrenbridge / Bridges joint venture on over 700,000 sq ft of net-zero carbon logistics space across the South East
4 October 2022
News
Forsters has advised a joint venture between Wrenbridge and Bridges Fund Management on the acquisition of sites in Aylesford, Basingstoke, and Stevenage and in securing planning permission for up to 700,000 sq ft of new, net-zero carbon logistics space across the sites in the South East of England.
Commercial Real Estate Partner Victoria Towers and Senior Associates Paul Grayson, Ed Glass, and Charlie Croft advised on the deals, with GLP UK also supporting the developments in Basingstoke and Stevenage through forward funding.
At Aylesford the site has planning permission for 300,000 sq ft across six units and will include substantial solar panel and air source heat pump installations expected to avert over 500 tonnes of CO2 emissions, while reducing tenant energy bills by at least £200,000 per year. Building work will begin on site at the end of 2022, with the property in line to become the most sustainable scheme in Kent. Ben Coles, Chief Executive of Wrenbridge, said the scheme’s “proximity to motorway connections is unrivalled.”
The Basingstoke and Stevenage sites both have planning permission for over 205,000 sq ft, with a single 209,461 sq ft facility expected to be completed at Basingstoke in 2023, while at Stevenage three facilities ranging from 25,736 sq ft to 106,531 sq ft (the largest of which has been pre-let to FTSE 100 company Bunzl) also expected to complete in 2023. The units are to be built to net-zero carbon and Exemplar ESG specifications. Wrenbridge Chief Executive Ben Coles said: “We are excited about developing these schemes and working with GLP to deliver a best-in-class product backed by a pre-let to Bunzl in Stevenage.”
All the sites will be targeting BREEAM Excellent and EPC A+ ratings, and Bridges Fund Management Partner Henry Pepper said: “At Bridges, we are committed to delivering some of the most sustainable industrial schemes in the UK – not only because it reduces emissions and supports the transition to net zero, but also because it makes the buildings more attractive to potential occupiers.”
Victoria Towers commented: “We are excited to be working with Wrenbridge and Bridges on these projects and to be leading from the front when it comes to the green agenda. Not only is the connectivity of the Aylesford site exceptional, but the combined schemes will be best in class in terms of sustainability.”
Depth and diversification will drive logistics growth – Victoria Towers writes for React News
27 July 2022
Views
The emergence of a new sub-sector of alternative uses is providing opportunities for investors and developers.
Commercial Real Estate Partner and Co-Head of Logistics, Victoria Towers, has guest written for React News on the rapid growth of the industrial and logistics market, resulting from changes in consumer behaviour thanks to the pandemic, the adoption of new technology, and the inexorable rise of e-commerce.
Contrary to popular belief that Amazon’s apparent reining in of its growing property requirements would curtail market growth, recent research from CBRE demonstrates a 10% growth in take-up of warehouse space between the first half of this year and last, alongside a UK vacancy rate of 1.2% – a new record low.
Towers describes how such growth and confidence in the sector can be attributed to the diversity across its occupier base. Production and distribution, life sciences, and light industry are all sectors worth mentioning, whilst “data centres have [also] become critical pieces of national infrastructure, required to store and process the data by the move to cloud-based computing.”
The lack of supply and high interest in this sector will continue to fuel the meteoric rise of the industrials and logistics market, and the diversification of the occupier base means that the pace of this growth may yet accelerate further. Landlords and developers must be forward-thinking and quick-moving in order to flourish and meet this growing demand from uses which will, over time, emerge from the alternative to the mainstream class.
This article originally appeared in React News on 21 July 2022, available here behind their paywall.
Where have all the good sheds gone… – Victoria Towers writes for Logistics Manager
6 July 2022
Views
You can’t find a good shed these days for what seems like love nor money – is this going to be the new ‘normal’?
Industrials & Logistics Partner, Victoria Towers, has provided expert commentary to Logistics Manager magazine on the growing supply-demand imbalance of warehouse space and the unsurprising increase in rent levels, highlighting that “we are still in a landlord’s market.”
As a result, speculative space is frequently being let during construction, prior to practical completion.
Towers adds that “with demand still very much outweighing supply, occupiers are also accepting longer leases and thought is being given to rent reviews. Rather than open market rent reviews, developers and landlords are looking at CPI rent reviews, and this is being accepted by tenants.”
The article summarises that due to inefficiencies within councils in relation to planning approvals for new developments, developers and investors are essentially taking a lottery ticket when it comes to getting their planning application approved, regardless of their scale of investment or prior experience with the system.
This article first appeared in the July 2022 edition of Logistics Manager magazine, it is available here.
Forsters advises Barwood Capital and Invesco Real Estate on the acquisition of two proposed industrial and logistics schemes
7 June 2022
News
Commercial Real Estate Partner, Victoria Towers, led a team advising a new partnership between Barwood Capital (“Barwood”) and Invesco Real Estate (“Invesco”) on the acquisition of its first two assets in a proposed portfolio of urban/last mile industrial and logistics warehouses.
Working with Victoria, Senior Associate, Ed Glass assisted on the purchase of the Manchester site, and Commercial Real Estate Partner, Jade Capper on the Coventry acquisition.
The first property to be purchased by the joint venture is a 4 acre site on Manchester’s Trafford Retail Park, with the second being located in Coventry, close to Junction 3 of the M6. Consent for the 5.25 acre Coventry scheme has already been secured and construction is due to start in July 2022. The combined GDV of the sites is expected to be c.£300m. As part of Invesco’s net zero objectives, the sites will be developed with the firm’s proprietary ESG checklist and criteria in mind.
Edward Henson, Director and Head of Transactions at Barwood, said: “Demand for industrial space remains strong across the UK regions and our partnership with Invesco allows us to use our combined expertise to unlock development and asset management opportunities and capture the supply/demand imbalance that exists in key locations.”
Rob Johnston, Head of UK and Nordic Real Estate Transactions at Invesco, added: “We have a strong pipeline of further opportunities as we work towards our aim to create a portfolio of 6-8 schemes, with an AUM of around £300m.”
Forsters advises Fiera Real Estate and Wrenbridge on purchase of £33m ESG Exemplar Industrial Scheme in Portsmouth
31 May 2022
News
Forsters has advised Fiera Real Estate (‘FRE UK’) and Wrenbridge on the purchase of a 4.5-acre site in Portsmouth for a £33m ESG Exemplar Grade A industrial scheme.
Commercial Real Estate Partner Victoria Towers and Senior Associate Paul Grayson advised on the deal, which aims to obtain planning permission for seven industrial units ranging from 6319 sq ft to 29785 sq ft.
Sustainability and wellbeing considerations are central to the proposed scheme, which is targeting BREEAM Excellent and an EPC A rating. It will offer high efficiency heating and cooling systems, water-saving fixtures and fittings and PV panels will be fixed to all buildings. During construction, the scheme will promote the use of locally sourced goods and low-emitting carbon materials, as well as ensuring that the contractors are part of the Considerate Contractor Scheme.
Will Jarman, Associate Director at Wrenbridge commented: “we are delighted to secure this prominent site in Portsmouth and view this transaction as the first of many within a strategic push towards the M27 corridor on the South Coast. We are in discussions with occupiers on pre-lets as we plan to bring forward a highly sustainable scheme to the area. Wrenbridge and Fiera have significant capital to deploy into the industrial and logistics sector across our key geographies, with the South Coast now also firmly in focus.”
The UK Logistics Market, A Gift That Keeps On Giving – Victoria Towers speaks to Logistics Manager
6 May 2022
Views
Despite the UK experiencing its deepest recession for 300 years, the industrials and logistics property industry has been enjoying a surprising period of growth.
Industrials & Logistics Partner, Victoria Towers, has provided expert commentary to Logistics Manager magazine on this welcome rise in demand for the sector, describing how Forsters“has seen rent levels in London go up from £17.50 to £24 per square foot (an increase of 37%) in ‘a matter of months.'”
“You are not going to see that kind of growth in offices [or retail at the moment].”
An interesting aspect of today’s market, she adds, which is contributing to the rise in rental prices, “is that some of the big players cannot get their foot in the door and so are pairing-up with developers on the ground and pursuing off-market deals.”
Victoria explains that many investors look to avoid open market sales in which they may be outbid, and so are acting quickly to prevent such competitive situations.
This article first appeared in the May 2022 edition of Logistics Manager magazine, it is available here.
Forsters advises Wrenbridge and Fiera Real Estate UK on purchase of 56,117 sq. ft. of industrial units in Crawley
28 April 2022
News
Forsters has advised Fiera Real Estate UK (“FRE UK”) and Wrenbridge on the purchase of a 2.4 acre site in Crawley consisting of five industrial units which total 56,117 sq. ft.
The business plan is to obtain planning for a new 65,000 sq. ft. Grade A industrial warehouse development with a GDV of £27m.
The site was purchased through the Fiera Real Estate Opportunity Fund V UK, the latest fund in FRE UK’s programmatic venture series with CBRE Global Investment Managers. This is the 16th acquisition for the Fund which reached its final close earlier this year with £180m of capital and is targeting similar sites for industrial development around the UK.
Chris Button, Fund Manager at FRE UK, commented “We are very pleased to be bringing forward yet another high-quality and sustainable scheme alongside our Operating Partner, Wrenbridge. This is the latest acquisition for our value-add Fund, FREOF V UK, which currently has a pipeline of more than 1.4million sq. ft. of industrial and logistics space. The Fund is targeting similar sites for speculative industrial development around the UK.”
Forsters has advised Fiera Real Estate UK (“FRE UK”) and Wrenbridge on the sale of a 33,000 sq. ft. urban logistics unit in Park Royal, London
22 April 2022
News
The property was purchased from Wrenbridge and Fiera Real Estate’s Opportunity Fund V UK, a programmatic venture series with CBRE Global Investment Management.
The asset, which is currently let to a cosmetics wholesaler with a lease expiry in December 2022, was purchased by Vengrove for VRE Industrial Partners (VREIP), its UK value-add industrial and logistics strategy. It is VREIP’s first acquisition in London, as it seeks to assemble a regionally balanced UK portfolio.
Chris Button, Fund Manager at FRE UK, commented “We are delighted to have completed on the sale of this high-quality asset, located in the midst of London’s logistics hub. Fiera Real Estate has considerable funds to commit to sites with similar features around the UK.”
Commercial Real Estate Partners Smita Edwards and Jade Capper advised on the deal. Stonehill also acted on behalf of FRE UK and Wrenbridge. Vengrove was advised by Levy Real Estate, Dentons, Hollis and Nova Ambiente.
