Big Box Rethink As North West Supply Steps Up
It has been an expensive few weeks for Mike Ashley.
Costly disappointments include £130M in losses from takeover attempts at Debenhams and the collapse of a £139M bid for Findel. No wonder the Sports Direct boss thinks now is a good time to slim down the North West supply chain.
Ashley's Sports Direct is to close its 360K SF Wigan warehouse, in the process saving it £1.6M a year in rent.
The Martland Park premises were sold by Sports Direct to investor clients of Franck Steier Price in 2014 as part of a £21M deal including the 100K SF unit next door.
The warehouse and office complex were then re-let to Sports Direct on a 10-year lease, with a break in 2019, which they are now exercising. The rent was £1.6M a year. Speculation about the future of the warehouse dates to 2016 when Sports Direct’s agents CBRE offered the building to other tenants.
According to new data from Colliers International, Ashley has picked a good time to rethink big box needs because a modest supply surge is on its way.
About 2M SF of large industrial and logistics space will be delivered speculatively across the North West in 2019, the second largest amount in the UK, according to the latest sector research by Colliers.
The firm’s Spring 2019 Industrial and Logistics Barometer showed 10 units of more than 100K SF being built to meet demand from online retailers. This is second only to the East Midlands, where 4.1M SF is under construction.
Colliers also identified commitments by developers to provide a further eight ‘Big Box’ sites representing about 872K SF in 2020 — with more expected to be announced.
The largest scheme in the North West is the Bericote/Hillwoods development at Haydock, spanning 523K SF and due for completion in June. The 2020 cohort includes Carrington Gateway, a 212K SF development of six units by HIMOR on a 19-acre site.