Kevin Mofid | Head of Logistics & Industrial Research | Savills

Quantifying the Cold Chain

October 2020

In real estate terms cold storage facilities have, traditionally, been an under researched area of the property market. Whilst specialist facilities have always existed much of the cold storage that exists in the UK has been retrofitted to existing warehouse units. When this spaced is leased from a landlord the installation of chilled and frozen space would fall under the category of an occupiers fit out, which, from a data perspective, makes the market very difficult to track and also very difficult to quantify.

For many structural reasons interest in cold storage real estate has increased over recent years and these trends have been magnified by the onset of Covid-19. Close cooperation between the UK Cold Chain Federation and Savills has resulted in a pooling of knowledge and data in order to produce a dataset and report that serves the needs of both organisations. In real estate terms property investors and developers will benefit from the increased transparency that data brings and for the Cold Chain Federation the ability to accurately market size the sector for the first time will bring much needed clarity to lobbying efforts on behalf of the members of the organisation.

In order to undertake the data analysis Savills utilised in house data but also vast databases of unstructured data from secondary sources. This allowed for the creation of a master database of warehouse facilities in the UK over 50,000 sq ft where at least 10% of the floorspace has been given over for cold and chilled storage.

A key findings from the data is that our analysis has identified 678 warehouse units over 50,000 sq ft that make up the UK Cold Storage Sector. This equates to 134m sq ft of warehouse space, accounting for 12% of the total modern warehouse space in the UK over 50,000 sq ft. Within these facilities we have identified 49m sq ft of space that is dedicated to frozen or chilled storage.

At a regional level it is interesting to note that the cold storage market does not follow the same pattern as the traditional logistics market where the Midlands dominates the total stock figures. Instead Yorkshire and the North West are the dominant markets accounting for 29% of the total cold storage space in the UK, reflecting 38.5m sq ft of space. The Midlands region accounts for just 22% of the cold storage stock in the UK, whereas in the traditional big box market 36% of the stock is located in the Midlands.

Looking at the data by size shows that at the smaller end for units under 100,000 sq ft 76% of units are occupied by either 3PL’s or processing and manufacturing companies with just 11% of facilities occupied by retailers. Splitting the unit size into 100,000 sq ft size bands shows that the retail and food service sector increases the amount of space occupied with each size band increase, culminating in the fact that of the floorspace over 500,000 sq ft 78% (21m sq ft) is occupied by companies in that sector.

For both Savills and the Cold Chain Federation this data is viewed as a starting point and over time we expect more data to be added to the dataset which will allow for further analysis such as the age and quality of buildings and the type of refrigeration used in the facility. This analysis will further improve transparency in a sector which is becoming more important to all of our daily lives.


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