The industrial property market has seldom been such a popular destination for investment funds. Over the past five years, consistently high total returns have placed it on the “buy” list for many investors. Yet this is set in a context in which much manufacturing industry continues to struggle and efficiency considerations continue to squeeze costs in warehousing and logistics.
Over the next decade amongst other things manufacturing industry must cope with massively increased global competition from China and the low cost base offered by the east European states acceding to the European Union in 2005.

How will these factors affect industrial property markets? Will we see an early-eighties style rationalization of the industrial stock reducing it still further? Or might we see a manufacturing renaissance led by high-quality, high-value products for the global market?
Distribution space has no fewer clouds on the horizon. Rigorous implementation of the working hours directive, for example, may well see an industry optimized around a completely different working pattern struggling to rebuild itself.

This report uses the existing UK industrial property market as its base and reports the expectations of the main stakeholder groups against a set of ten-year scenarios. For investors, developers and occupiers of industrial space this will provide important information for their long-term strategy.

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The market for industrial property over the next decade

This study is being carried out and promoted as part of the RICS Foundation initiative aimed at raising awareness of possible futures for the real estate industry.