The total volume of space for the retail warehouse segment (including occupied retail parks and stand-alone retail warehouse units) is estimated at just over 4.15 m sq m. This is 4% over the figure registered last year, when several Labour Force Adjustment Plans (EREs) signed by well-known retailers, forced these brands to close many of their stores. The y-o-y variation then was -3%.
Large retailers continue to push on with their expansion plans in order to improve sales figures.
Almost 70,000 sq m of new space spread over three retail parks is expected to be delivered in 2013. 305,000 sq m of space is in the pipeline over the next two years; however delivery schedules will predominantly depend on financing.
The slowdown in activity in the retail investment market since 2008 has also affected the retail warehouse segment. Economic instability has meant that international investors have progressively steered clear of the market, which has meant that national investors have carried out some retail park and stand-alone retail warehouse transactions. These national investors are not necessarily highly specialised in the retail warehouse sector, however they have moved in to this sector, given that it requires less specialist knowledge than the shopping centre market.
The lack of transacted deals makes it difficult to establish a yield for this sector. The latest data available would put the prime yield at 7.5%.
Source : Savills