Our 2015 Mid Year Industrial Investment Update reveals that:

• H1 saw a number of large distribution transactions, predominantly in the South East and the Golden Triangle. Strong activity was also seen in the North West, Yorkshire and West Midlands, as investors capitalised on growing demand from the Automotive, Aerospace and Internet Retail sectors.
• Yields within the distribution sector hardened significantly in H1 2015, reflecting strong demand for secure income. While institutional appetite for distribution warehouses dominates the demand profile, a number of REITS are also actively expanding in the sector, with Tritax Big Box REIT acquiring over £310m of assets in H1.
• The multi-let market has also seen significant yield compression during H1 2015, driven by the lack of modern, South East stock. The greater London market saw less than £30m of stock traded in H1 2015, but we foresee this increasing significantly as a number of larger estates transact, such as Waterway Park, Hayes and Oxgate Centre, Staples Corner. 
• Institutional Investors again dominate this sub-sector but we have seen a number of competitive property companies in the South East market such as Capital Industrial and Compagnie du Parc. 
• Further yield compression is also expected, as institutional investors seek to deploy significant capital into the market. Moving forward, we expect market activity to remain buoyant over the remainder of the year, with more motivated sellers capitalising on strong pent-up demand. 
• In a bid to source stock, we have seen a marked increase in funding for speculative development, which more than tripled during H1 to stand at 8.2m sq ft across the UK. With an extremely tight supply of existing new-build space and robust occupier demand, this trend will continue through the remainder of 2015.