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Industrial and logistics: outlook for 2024 and beyond

As we reported after ShedMasters 2023, the annual event held exclusively for the European industrial and logistics sector, the key themes of the conference revolved around challenges in supply and demand, developing ESG-friendly warehouses and the increasing development of nearshoring, all against the backdrop of a volatile global economy.

Whilst we are finally seeing a downturn in inflation, interest rates remain high (for now at least), and in the UK, we now have the added uncertainty of a looming general election. It is only natural that suppliers have taken a cautious approach to expansion. If interest rates remain static, investment activity is predicted to be lower throughout 2024 in comparison to previous years.

Not all is lost in the realm of demand, however, with demand for small or mid-sized units mainly coming from third party logistics businesses. This is predicted to continue, with discounter retailers and nearshoring businesses expected to keep the pressure up on demand.

E-commerce is also thriving. Recent data from ONS and Revolut confirms that over 40% of all Revolut debit card transactions occurred online during September 2023. This appetite for online sales drives a desire for instant delivery and hence the continued prediction in the rise of nearshoring. It will be interesting to see how companies innovate to accommodate this ever-increasing pace of delivery.

On the flip side, there has been an increase in supply driven by the increased variety of units available. This increase in choice has resulted in some businesses assessing their space and how suitable this is for continued operations, hence the shift to smaller spaces. In this vein, Stevens & Bolton has also recently seen clients invest in works to reconfigure their spaces to fit in with their changing needs. However, an overall downward trend is predicted for 2024, particularly regarding new, larger units.

The industrial and logistics real estate market continues to follow the wider real estate market when it comes to high-quality, energy efficient space. Last year, Grade A property contributed 70% of all take up. The growing demand for ESG-focused space will continue to be a theme in 2024 as it was in 2023. Supplies are looking for space with solar panels, or EV charging points and, indeed, these aspects are now becoming standard in the building of new developments.

ShedMasters 2024

Stevens & Bolton is once again co-hosting ShedMasters, this year being held in Amsterdam. The conference is sure to tease out exciting developments in the industry and we look forward to hearing from other experts in the field. No doubt the themes above will be touched upon but also many more. For more information, please visit the ShedMasters 2024 website here.


real estate, real estate disputes, industrial and logistics, construction and engineering, sustainability and esg