Land values are rocketing as a result of the thriving logistics and distribution sector

Gateway 385, Peterborough

The need for more warehouses is national, but areas across the Oxford Cambridge Arc and the Cambridge to Norwich Tech Corridor are home to significant demand.

Many companies are looking to acquire assets in Europe’s key logistics corridors, so are pursuing new development avenues. One of these new avenues is build-to-suit developments on agricultural land, it is becoming increasingly popular as it guarantees distributors have sufficient warehouse space for demand.

One prime example of a logistics development within the OxCam Arc is Peterborough Gateway. A local landowner and Newlands Developments entered a joint venture agreement to develop out the 240 acre land sat along the A1 into the Peterborough Gateway. The developer secured outline planning consent for warehouse and industrial use in 2012.

Now, 4.1m sq ft of buildings are completed and hold a gross value of over £300m. Amazon, distributor DPD, supermarket Lidl and retailer Urban Outfitters occupy warehouses at the development.

The rise in this kind of development is driving land market values sky high. With planning permission, the value of land for such developments ranges from £400,000 to £2m an acre. The rise in demand for suitable land to build warehouses on is catching up with residential land value in some areas and is presenting significant opportunities for landowners. Grade 3 land or poorer would be the most suitable for this kind of development, but if the site is good then there’s no restriction on land quality. Any site with the capability of delivering a large-scale warehouse space is sure to be developed out very
quickly.