Online retailers fuel UK warehouse boom

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The growth of ecommerce has fuelled a high demand for warehouse space, according to an October 2017 ThisIsMoney.co.uk article, with many large online retailers needing a network of regional warehouses in order to provide speedy delivery.

Perhaps surprisingly, huge retailers such as Amazon and Currys do not build their own warehouses but rent them on long leases. The gigantic warehouses these companies use are too expensive for the average individual investor to fund and are usually owned by large companies financed by a number of investors. There are many specialist smaller online retailers that require smaller warehouses to rent and these can be owned by individual landlords.

Warehouse location is the primary factor for online retailers. They need warehouses close to major motorway networks so that goods can be dispatched to most areas of the UK by the next day after ordering. Amazon has smaller satellite warehouses near major cities that deliver high demand items on the same day as they are ordered. If other online retailers follow this model, there will be an increased demand for small-to-medium warehouses within a short distance of large UK cities.

The retail property sector has slowed down in the last few years. Many analysts predict that online shopping will not replace the need for retail stores. Amazon has demonstrated a new model for the retail store in which it acts as a showcase for its online business.

Investors wishing to purchase warehouse property can apply for a commercial mortgage through a mortgage broker to finance their property deals.

Online retailers fuel UK warehouse boom

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The growth of ecommerce has fuelled a high demand for warehouse space, according to an October 2017 ThisIsMoney.co.uk article, with many large online retailers needing a network of regional warehouses in order to provide speedy delivery.

Perhaps surprisingly, huge retailers such as Amazon and Currys do not build their own warehouses but rent them on long leases. The gigantic warehouses these companies use are too expensive for the average individual investor to fund and are usually owned by large companies financed by a number of investors. There are many specialist smaller online retailers that require smaller warehouses to rent and these can be owned by individual landlords.

Warehouse location is the primary factor for online retailers. They need warehouses close to major motorway networks so that goods can be dispatched to most areas of the UK by the next day after ordering. Amazon has smaller satellite warehouses near major cities that deliver high demand items on the same day as they are ordered. If other online retailers follow this model, there will be an increased demand for small-to-medium warehouses within a short distance of large UK cities.

The retail property sector has slowed down in the last few years. Many analysts predict that online shopping will not replace the need for retail stores. Amazon has demonstrated a new model for the retail store in which it acts as a showcase for its online business.

Investors wishing to purchase warehouse property can apply for a commercial mortgage through a mortgage broker to finance their property deals.

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