Peter Ward, Chief Executive of the United Kingdom Warehousing Association (UKWA), has said that British warehouses are full due to stockpiling for Brexit.
In an interview with the BBC television program Newsnight, he claimed:
“There is no available space.”
Data published by property company Savills found that there is some limited warehouse capacity left. The vacancy rate for UK warehouses of 100,000 sq. ft. and over was 6.8% in the second quarter of 2019. In the M25 area, there was a 2.2% vacancy rate, but in the West Midlands there is 10.6% and in the North West 9.6% vacant space. Around 10 years ago, the vacancy rate was about 23%.
If there is a no-deal Brexit, this could mean that border checks could slow down the movement of goods from the EU to Britain. Many businesses have responded to this possibility by stockpiling goods. Kevin Mofid and Richard Sullivan of Savills said that another reason for high warehouse demand is the growth of ecommerce, which generally needs more warehouse space than shop retailing.
To create more storage space, there ais an estimated 7.5 million square feet of new warehouse construction but it will be some time before all these warehouses are completed. Existing warehouses may be able to install mezzanine space and reorganise warehouse shelving to maximise space.
Warehouse equipment supplier companies should prosper as the new facilities will require plenty of warehouses racks, shelving, trolleys and other equipment to store and move goods around the storage areas.
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