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Big jump in third quarter industrial property take up in Wales

The take up of large industrial property in Wales reached 800,000 sq ft in the third quarter of the year, according to the latest report from global property consultancy Knight Frank.

This level of activity for properties over 50,000 sq ft showed a fourfold increase over the take up for Q2 this year, and compares with 1.3 million sq ft for the third quarter last year.  The overall take up for the first nine months of 2023 was 300,000 sq ft down on the same period last year.

The Q3 take up comprised six transactions, with three lettings and two sales in South Wales  and one sale in North Wales.

Neil Francis, head of Knight Frank’s Logistics & Industrial team in Cardiff, said: “The largest transaction was the sale of Toyoda Gosei in Gorseinon, Swansea to Jayplas at 255,000 sq ft.

“Interestingly, two deals involved companies from the Creative Industries sector with Great Point Media acquiring its building freehold, and Bad Wolf taking additional space in Bridgend. Both highlight the continued growth in this sector and its importance for increasing the profile of South Wales and generating employment within the supply chain.”

He added: “I predicted in Q2 that we would witness more closures and sadly in the last three months we have seen 10 different occupiers either announce closures or plans to rationalise their property portfolio.”

The Knight Frank report shows that availability in Wales for the quarter stood at 6.5 million sq ft, up by 1.2 million sq ft on Q2 and significantly more than the 4.4 million sq ft recorded this time last year.

Neil Francis said: “Within this availability, 1.6 million sq ft is the Ford site which is still rumoured to be under offer but with no indication of when a sale might complete. In addition the sad demise of Wilko has released another 850,000 sq ft distribution facility to the market as the company vacates its Magor warehouse.

“On the positive side, St Modwen has finished construction of its three new units in Newport with the 52,000 sq ft letting completing in October, and terms being discussed on the remaining 106,000 and 116,000 sq ft units.

“Within the St Modwen Park estate a new headline rent has been set with a further letting on phase 3, where 24,000 sq ft has been leased on a new 10 year lease.

“Wales Government has completed its 52,582 sq ft unit RYB1 at Rhyd y Blew in Ebbw Vale and with a number of occupiers eager to discuss terms we expect to be under offer in Q4.

“Whilst industrial take up figures are clearly better than Q2 there is still a lot of uncertainty in the market. There is a definite flight to quality with the better located and presented stock securing strong demand which is increasing the headline rents secured with every new letting.”