Online shopping boom creates warehousing opportunities for farmers

Farmers in Norfolk and Suffolk may be able to convert disused buildings into warehouse space, says Michael Horton of Savills

Farmers in Norfolk and Suffolk may be able to convert disused buildings into warehouse space, says Michael Horton of Savills - Credit: Savills / Richard Marsham

Farmers and landowners in Norfolk and Suffolk are well placed to cash in on rising demand for warehouse space sparked by an online shopping boom, said agents.

Rural advisors at Savills said the growth in parcel deliveries, accelerated by the Covid pandemic, had fuelled a need for storage in more rural and semi-rural locations.

They reported an increase in the number of logistics companies looking for buildings to store goods as they roll off container ships at the Port of Felixstowe – making locations off the A14, A12, A140 and A11 highly desirable.

Michael Horton, head of rural management at Savills Suffolk, said: “Traditionally the logistics sector has been long-haul. Goods come off the container ships at the Port of Felixstowe and then get taken to the Midlands.

"However with the coronavirus pandemic increasing people’s willingness to shop online – and with many goods now expected to be delivered the next day – that picture has changed.

“Over the last 12 to 18 months we have seen increasing demand for sites that are much closer to home along key arterial routes such as the A14 and A12 as well as the A140 and even the A11.

"With 46pc of UK container traffic coming through Felixstowe it means that geographically there are now opportunities that perhaps weren’t there previously.

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“Farmers and landowners will obviously have to ensure it fits with their business model – and there may well be issues to consider around access, planning, tax and insurance – however for those with old agricultural buildings that are currently sitting empty or a former airstrip that might lend itself to development then it’s well worth considering.

“Typically we are seeing returns of up to £8 per square foot, whereas a few years ago it was perhaps more like £4 or £5 per square foot.

"People are unlikely to change their shopping habits anytime soon, so we don’t anticipate that this demand will fall away.”

Edward Fitzalan-Howard, from the rural management team at Savills Norfolk, said even smaller buildings could offer opportunities.

“Local businesses often need somewhere to store archive materials, for example, or disused agricultural buildings could be converted into self-storage facilities,” he said.

“The change in people’s working patterns as a result of the pandemic has also opened up a really interesting opportunity around diversifying and creating small-scale business parks and flexible office space suitable for hot-desking."

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