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The UK government must remember the logistics sector when tackling the housing crisis that has enveloped the nation’s capital.
According to a report commissioned by property and investment development firm Segro, the city’s population will exceed 10 million by 2031.
At the launch of Keep London Working, Segro chief operating officer Andy Gulliford called for a balanced approach, addressing both the need for housing and industrial developments.
“We understand that there is a housing shortage and need to build homes,” he said, “but there is an issue with many of these homes being built on industrial land.”
The report, authored by consultant Turley, says the expected influx of new residents will increase the need for London logistics space. And Mr Gulliford added that “we are moving into an omni-channel world”.
The report says: “This population growth, combined with technology, has led to an explosion of e-commerce. This is driving demand for industrial land to ensure we get all our goods delivered.”
However, the report notes that industrial land is being lost at three times the rate the Greater London Authority (GLA) expected, with the land frequently going to residential use.
“At the current rate of decline, the GLA’s expected release of industrial land by 2031 could be reached this year,” adds the report. “The loss of industrial land is happening across all London boroughs, with the greatest impact in Newham, Greenwich, Bexley and Wandsworth.”
Chief executive of the British Property Federation Melanie Leech said the vital role in people’s everyday lives played by the industrial and logistics sector could often be overlooked.
She added: “The provision of industrial land does more than just ensure that online deliveries arrive on time – it also creates skilled jobs and delivers significant economic growth.
“Sustainable communities require both homes and the right infrastructure to provide services, facilities and jobs. We therefore fully support Segro’s recommendations.”
Segro’s business unit director Alan Holland called for an intensification of land use, proposing the idea of multi-level facilities that could accommodate more than one operation.
Mr Gulliford added: “We want firms to be more innovative and flexible in the way they use their land; this can bring both development and jobs.”
Outlining the top four of the firm’s 10-point plan, Mr Gulliford called for the development of an industry board that could be staffed partly by logistics specialists to provide knowledgeable input.
He said it was vital for firms and government to undertake a strategic industrial land review to understand what was available, what was required and how these could be paired.
“There must also be a comprehensive demand assessment,” said Mr Gulliford. “This should be conducted at a city government level as well as borough by borough. We need to ask what is needed, and whether the land is available meet these requirements.”
Mr Holland said London’s logistics sector, set within the largest e-commerce market in Europe, would continue to grow.
“Intensification is a big topic,” he continued. “The appetite from logistics firms is far different now and before too long we are confident of delivering London’s first multi-level logistics building.”