The future of industrial land supply

We help the UK real estate sector grow and thrive

•Introduction to BPF and Industrial Committee

•Presentation on economic contribution of sector

•Discussion and questions

Agenda

Building 2110, Magna Park Lutterworth

•Trade body for owners and investors in commercial real estate

•Work with Government and stakeholders to help sector grow and thrive sustainably

•Focus on delivering a successful economy, essential infrastructure and great places

•Industrial Committee convened in 2014, as the sector faced unique set of challenges in period of growth

•Provide united voice to Government

•Remained misunderstood by policy makers and practitioners alike

British Property Federation

Industrial Committee

BPF Industrial Committee Members

SEGRO IDI Gazeley

A&J Mucklow Barton Willmore

Colliers Delin Capital

Deloitte Real Estate Eversheds

Goodman Graftongate

Harworth Estates Hogan Lovells

Industrial Agents Society Kilbride Holdings

Legal & General M&G

Network Rail Peel

Roxhill Turley

•Started from a low base setting out content and contribution of sector

•Focus on DCLG due to planning issues

•Individual meetings presenting research, and offering policy solutions

•Follow-ups on NPPF consultation and technical points

•Presentations on the sector at cross-departmental meetings

•Site visit to show true content of industrial site with senior civil servants from DCLG, BEIS, and HMT

BPF engagement

IDI Gazeley – Internal Warehouse Finish

•A fundamental lack of understanding of importance of industrial and logistics markets

•Land not being designated in the right locations

•Loss of employment land to residential

•Proposed changes to NPPF placing time limit on land marked for commercial

•Emerging industrial strategy provides opportunity for engagement

•Devolution also offers new access points to Government, especially in areas that will have strategic planning powers

Challenges and opportunities

Delivering the GoodsThe Economic Benefits of Logistics and

Planning for Employment Land

December 2016

The Research Study

Data

Case studiesWider studies

Method

Magna Park, Milton Keynes – IDI Gazeley

DPD Group UK

• Hinckley, East Midlands • Newest of four hubs • 303,550 sqft • 615 FTE staff • ‘changed beyond all

recognition’ as a result of consumer shift

DP World London Gateway

• London Gateway, Thurrock • Port-centric logistics park with rail

connectivity • Local Development Order for 9m sqft • C.500,000 sqft built • 500 staff rising to 12,000 once

completed (2,000 port)

Sainsbury’s, DIRFT

• Daventry International Rail Freight Terminal

• National Distribution Centre with direct rail access

• 979,200 sqft including B8 and B1 • 550 staff rising to 1,000

Economic contributor

• 65,100 logistics businesses

• 740,000 employees (3%)

• 2.2 million (8%) when other sectors included

Economic contributor

+40% Warehouse jobs 2009-2013

Economic contributor

• 75% of 300 logistics companies surveyed recruited 2013-2014

• 2/3rds for new posts

Economic contributor

10 milesMost employees live locally

Economic contributor

£GVA• £62-100 billion a year (5%)

• +50% 1997-2012

• GVA per employee rising +46% 2013-2035

Challenging perceptions

Challenging perceptions

Challenging perceptions

Range of occupations and opportunities for progression Delivering skills and learning

Sqm per FTE Job Source

70-95 HCA Employment Density Guide 3rd Edition, 2015

69 Prologis, 201548 DPD Group UK, Hinckley

Individual scheme impact

The future for logistics

National Logistics

Barriers to growth

Space

Planning

Skills

The Advanced Manufacturing Park, Waverley, South Yorkshire – Harworth Estates

The Land That Time Forgot

Turley, 2015

The Return to The Land That Time Forgot

• Limited alignment in evidence base gathering despite PPG

• Limited appreciation of variety needs of different industrial land occupiers

• Pro-business planning is needed!

Recommendations

1. Provision of the right quantity of space in the right locations

2. Acknowledgement of the economic contribution of the sector

3. Coordinated infrastructure planning

4. A joined up approach from government

5. Building a dialogue with local planning authorities

Magna Park, Milton Keynes – IDI Gazeley

Discussion and questions

•Engage with the sector to ensure it supports UK economic growth – the Government’s emerging Industrial Strategy must take into account the need for industrial real estate to support innovation, manufacturing and research & development

•Planning policy that reflects the needs of businesses – local authorities should undertake more regular employment land reviews, underpinned by regular engagement with the sector to understand business needs

•Emerging policy to better recognise industrial trends and market cycles – the proposed “use it or lose it” approach to land earmarked for commercial use is dangerous and unhelpful

•Improve understanding of the sector – cross-departmental support to help raise the importance of the sector with policy makers and ministers

•Contact Gareth or Rachel Campbell, BPF (rcampbell@bpf.org.uk) for more information

Call to action