Chinese e-commerce companies and their logistics partners accounted for 17% of UK warehouse take-up in Q3 2026, according to new research from Knight Frank.
The 1.6m sq ft of leasing activity for units of more than 50,000 sq ft is more than double the 7% share Knight Frank recorded across 2025 and H1 2026, when Chinese e-commerce occupiers signed for just over 4m sq ft.
Across the wider market, total take-up across the quarter of 9.6m sq ft was 7% lower than in Q2 and 8% below the five-year quarterly average.
Grade A space accounted for 59% of Q3 take-up, more than double its five-year average share of 26%. Overall vacancy held at 8%, but Knight Frank said modern space is scarce in many regions. Grade A vacancy stands at just 0.5% in Wales and 0.8% in West Yorkshire.
Speculative space under construction rose 45% during the quarter to 11.2m sq ft across 67 schemes and prime rents rose 3.5% year-on-year, up from 3.1% in Q2.
Claire Williams, partner and head of UK and European industrial research at Knight Frank, said: “Chinese e-commerce is no longer a niche source of demand. These businesses are building permanent fulfilment networks in Britain, and with the low-value import relief due to be removed, we expect more of them to hold stock and fulfil orders from UK warehouses. Across the market, occupiers remain focused on quality, and in many regions there is very little Grade A space left. That is supporting rental growth and has started to bring developers back, although new supply will take time to reach the markets that need it most.”
UK industrial and logistics investment totalled £2.76bn in Q3, up 85% on the £1.49bn recorded in Q2. Portfolio deals accounted for £1.41bn, or 51% of the total, lifting the average lot size to £30.9m from £24.4m.
Johnny Hawkins, head of UK logistics and industrial capital markets at Knight Frank, said: “Investors are increasingly willing to commit capital where assets are priced correctly. With capital growth slowing, investors are now more income-focused, targeting opportunities to drive returns through rental reversion and active management. Institutional investors are well-placed right now, given their longer-term view and lower reliance on debt. Rising rate expectations will keep buyers selective, but strong occupier fundamentals should support pricing for the best assets.”
