UK big box H1 2024

The UK's big box market experienced a significant boost in occupier transactions during the second quarter (Q2) of the year, following a sluggish start in Q1. Grade A space take-up across the country reached its highest quarterly total since Q1 2022, with approximately 8.3 million sq ft being transacted in Q2. This figure represents a 79% increase over the previous quarter and was more than double (+103%) the level recorded in the same period last year. As a result, the total take-up for the first half of the year (H1) reached 13.0 million sq ft, representing a 38% increase compared to H1 2023.

The Midlands, including both the East and West regions, continued to attract the majority of take-up, accounting for over half of all Q2 transactions. The East Midlands contributed 45% of the UK's total, with the West Midlands accounting for 13%. Additionally, the North West, which had experienced no deals in Q1, saw five transactions in Q2, equating to 12% of the UK total. Demand for commercial space was varied across different sectors, resulting in deals ranging from just over 100,000 sq ft to as large as 1.3 million sq ft.

The available space in existing buildings and those under construction or refurbishment increased by around 2.6 million sq ft in Q2, reaching a total of 39.4 million sq ft at mid-year. Consequently, the total availability rate rose from 8.9% at the end of Q1 to 9.4% at mid-year. Excluding space under construction or refurbishment, the availability rate increased from 6.8% to 6.9%.

Furthermore, prime headline rents across the country saw a 1.7% average unweighted increase in Q2 2024, a 3.1% increase over H1, and a 5.0% increase over the 12 months leading up to mid-2024. Although the annual growth rate has slowed compared to previous years, it remains respectable.

The report suggests reasons for market optimism for the second half of the year and beyond. The UK economy grew by 0.7% in Q1, and forecasts indicate stronger GDP growth in 2025 compared to 2024. Additionally, the reduction in inflation may lead to policy interest rate cuts. The outcome of the General Election has also resulted in a new government committed to economic stability and growth. The Chancellor announced plans to establish mandatory house building targets and reform the planning system to encourage more investment. While risks persist, the overall market prospects have improved.

To discover more about the big box market and access all the data, download our latest report.