As my first month at JLL comes to a close, it is only at this point, sitting, writing this blog, that I have had the opportunity to reflect, and let the whirlwind subside, if only for a moment.
I joined the Industrial & Logistics research team just at a point when it was required to finalise the quarter end data for the data cycle. Those of you reading this may not be familiar with the data cycle, as I surely was not before joining JLL. Joining the team at this time can only be comparable to jumping off a high dive head first. After my orientation had completed I was head first into talks of sheds, rents, yields, and speculative developments. Though I had not been studying the market for the first two and a half months of the year it was crucial that I learnt and understood what had transpired during the first quarter of 2016 and anticipate how the second quarter will play out. There was no time to “ease in” or “learn the ropes.”
It seems appropriate that I joined the Industrial & Logistics research team when I did. The commotion I have been engulfed in appeared to reflect the status of the UK industrial market. As I started my job with a steady workload, the UK industrial market was off to a steady start to 2016. Occupier demand was persistent, with take-up 22% up on the end of Q4 2015 and supply at the end of March 2016 was 5% up on the end of December 2015.
With occupier demand swiftly outpacing supply the market has experienced rental growth over the past 12 months. Developers have been focused on ramping up speculative development in order to meet the demand for good quality, well-located logistics properties and by the end of March 2016 there was 10.1 million sq ft of new space available nationally, 10% up on the end of December 2015.
Though the start to 2016 has been healthy, there is a quieter outlook for Q2 2016 due to the EU Referendum vote taking place on the 23rd June. Occupiers and investors are not as keen to jump in head first and instead are adopting a “wait and see” approach, as the vote on whether or not to stay in the EU has produced signs of caution throughout the logistics market.
With a quieter outlook for Q2 2016, my workload may also slow and I may be spared from being thrown right back into the whirlwind. This may be my opportunity to fully settle in; however, I am sure I shouldn’t get too comfortable. Although the UK logistics market may be in a “wait and see” period, the market is constantly evolving and analysis is crucial in order to accurately advise colleagues and clients.