Tritax Big Box REIT has signed an £89.3M funding deal which unlocks development of a 945K SF Bosch warehouse in Corby. The net initial yield is 5.2%.

The pre-let with BSH Home Appliances will be next to the pre-let agreed with Eddie Stobart, itself part of a 5M SF logistics development site.

Completion is due for August on a 10-year lease subject to five yearly upward-only rent reviews indexed to the retail price index, subject to a cap and collar.

Confidence among investors remains high, buoyed by data showing that the supply of large warehouse units remains tight, and is likely to stay low.

According to Colliers International’s latest Industrial & Logistics Barometer for Q3 2018, availability of industrial space over 100K SF has fallen on average by 71% in the last 10 years, with the South East and West Midlands (both 75%) amongst the worst affected. At the same time the number of speculative developments due for completion before the end of the year is below the annual four-year average (2013-2017) of 4.46M SF. It currently stands at 3.5M SF.

Signs of late cycle slow down are not apparent, CBRE Head of Logistics Strategy Jonathan Compton told Bisnow.

"You hear the expression late cycle a lot, and seven years into a cycle you do begin to think it's been going a long time and you expect it to plateau, but look at the statistics on demand or rents and there is no sign of it," he said. "Investment yields are probably as low as they will go this cycle, but I'm not expecting occupier demand to dissipate soon, there is still a lot of pent up demand."