St Modwen Logistics and Savills have called for improvements to the planning system to support and encourage greater levels of development of modern, sustainable warehousing to keep pace with occupier demand.
They cited joint research showing that historic land constraints have suppressed industrial demand by 29% over the past decade and, during the period, availability has been consistently below the ‘equilibrium rate’ of 8% – the rate at which supply and demand are considered to be in balance.
This has caused many fast-growing firms to halt expansion plans and created inefficiencies in supply chains.
Responding to the government’s call for evidence on the freight and logistics and the planning system, St Modwen Logistics and Savills have recommended the following five key policy changes:
Implement a national policy recognising industrial and logistics facilities as critical national infrastructure and introduce guidance which recognises the importance of wider supply chain employment and the indirect gross value added (GVA) as part of the wider planning balance;
Utilise the Savills/St Modwen Logistics ‘suppressed demand’ model within national planning practice guidance (NPPG) as the basis for assessing future demand for logistics space;
Require local authorities to set five-year employment land supply targets, mirroring their approach to residential land supply;
A more effective approach to strategic planning, favouring the reintroduction of a strategic tier of planning, helping to broaden planning authorities’ scope of considerations beyond housing market areas and travel to work patterns when assessing potential new logistics developments; and
Implement a government-led training programme to upskill local government planners, local members and planning inspectors on commercial markets and the key trends and market conditions that influence future logistics demand.
Richard Hickman, senior director of planning at St Modwen Logistics, said: “Logistics is a high-productivity and high-growth sector and one of the engines of the national economy, supporting an increasing number of high-skilled jobs across the country. The policy changes we recommend would unlock the delivery of high-quality new warehouse space in the locations where it is most needed.”
Mark Powney, director of economics at Savills, added: “The logistics sector has been the fastest growing commercial sector in the UK for over a decade. Jobs in the sector pay better than the national average across an increasingly diverse range of occupations. It is time the planning system takes measures to plan proactively for commercial uses in order help our struggling economy. As part of this, improving the way we plan for the strong demand from logistics occupiers must be a major focus.”
