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Are Beds, Not Sheds, The Safe Bet Now? A Hint From Blackstone

Sarwjit Sambhi

With the cost of living rising, inflation soaring, and no likelihood of energy prices falling in the medium term, could the consumer confidence that drove the growth of UK warehousing be at, or past, its peak?

And if it is, could beds take the lead over sheds as the key growth property sector?

There is a hint, albeit a small one, that Blackstone might be thinking along these lines.

St. Modwen, the UK-based beds-and-sheds developer acquired by Blackstone in August 2021, has announced plans to double its housebuilding business over the next five years.

The move involves folding its strategic land business into the homes business to accelerate growth.

St. Modwen’s residential and community focus will continue through St. Modwen Homes, which last year delivered almost 1,200 new homes. 

St. Modwen Homes is selling homes across 24 sites and is making significant land acquisitions to support its ambitious growth plans. 

“Bringing together our land capabilities is a natural progression for St. Modwen Homes and we hope a catalyst to double the size of this business,” St. Modwen chief executive Sarwjit Sambhi said.

The logistics end of the St. Modwen strategy has not lost its sparkle. St. Modwen Logistics delivered 1.4M SF of new warehouse space during 2021, with high levels of growth planned in 2022, backed by one of the UK’s largest pipelines at 19M SF.


St. Modwen makes its move as new analysis from planning and development consultancy Turley showed that beds and sheds make an ideal pairing.

The firm’s data showed that as much as 3.5M SF of modern employment floorspace alongside 23,377 new homes could be brought forward as part of co-location schemes in the capital.

Turley reviewed all co-location planning applications and masterplans referred to the Greater London Authority from January 2019 to January 2022. It found that co-location could provide an uplift of more than 1M SF of employment land in total and an average of 487 new homes per scheme, based on the schemes currently going through the planning system.

The analysis is part of Turley’s report called ‘Co-location in London: Is it stacking up?’ that unpicks the current delivery of schemes using this new “beds on sheds” model. The report highlights that co-location could help ease pressure on the overall London property market by making use of brownfield land to create both homes and industrial space.

“Co-location provides part of the answer to two of London’s biggest property challenges. Industrial space is in short supply and housing delivery needs to meet significant targets," Turley Director Catriona Fraser said.

“The data shows the significant potential of optimising existing brownfield land, even though it has currently only been adopted by a handful of London Boroughs. The key next step to growing the opportunities to deliver co-location will be showing how these current schemes work in practice."