Industrial & Logistics
Insights Edition 1 • Autumn 2024
How does the lack of power and development land as well as planning constraints challenge Labour’s growth targets? The UK’s industrial and logistics businesses keep the country running but the lack of land and available power along with planning constraints and delays are all preventing growth. Rob Champion, Partner and Head of Industrial & Logistics at Fisher German, believes Labour needs to upgrade the country’s industrial infrastructure and enable the delivery of employment development through further planning reform to meet its growth targets.
Industrial and logistics at all scales should be at the front and centre of Labour’s growth objectives in relation to planning and development because of its importance in powering the economy rather than just focusing on housebuilding. Statistics released by the British Property Federation highlight that the industrial and logistics industry adds over £137.5bn to the economy, which is the equivalent of 7% of Gross Value Added, and that the sector supports one in 12 jobs across the country as well as contributing another £7bn indirectly to local communities through the planning system. While it is positive to see that freight and logistics along with laboratories, gigafactories and data centres have been identified as key uses requiring appropriate strategic sites in the new draft National Planning Policy Framework (NPPF), the Government needs to place even greater weight on the delivery of best in class commercial space at all scales as part of the plan to stimulate economic growth and ensure the UK becomes a world leader in technology, manufacturing and logistics. Allied to that, there needs to be robust infrastructure with sufficient capacity along with clear, deliverable and ambitious planning policies. It is important the new Government tasks local authorities with focusing on the employment-
generating uses of appropriate sites when making strategic planning decisions. The biggest issue however is power – or the lack of it. The transmission and distribution network operators are struggling to deliver power to large projects – it was taking around 14 years until the Conservative Government introduced The Transmission Acceleration Action Plan which seeks to halve the end-to-end build time of electricity transmission network infrastructure, from 14 to seven years. To meet the growing demand from businesses and, in turn, boost the economy, it is going to be vital for Labour to crack this conundrum which itself is, in part, connected with the issues associated with planning and strategic decision making, otherwise this blocker will continue to stifle growth. The industrial and logistics industry is increasingly looking to the electric market and the importance of new developments being located where there is access to power is absolutely crucial. We are now seeing that while location remains vital to developers when they are selecting sites, having access to power may, in certain cases, override the usual ‘prime prime’
location characteristics. This could result in locations traditionally referred to as secondary in industrial and logistics terms receiving substantial investment as businesses align themselves with a suitable power supply. The UK continues to see demand from innovative and progressive companies who are requiring best- in- class industrial, logistics and laboratory facilities with high energy efficiency credentials and the best working environments for their employees. The UK market has some of the world’s best developers of commercial real estate who are and have been for some time at the forefront of building design and focused on continual improvement. Collectively, these vital players in the UK economy are being constrained due to systemic failure and I encourage the new government to be bold in their policy- making and, crucially, listen to our industry to gain reasoned insight into how best to facilitate change and, in turn, enhance the attractiveness and productivity of the UK. To read this article in full scan or click the QR code.