Flying the Flag on the World Stage
How the Industrial & Logistics sector is playing a key role in facilitating overseas investment in the UK
As ministers return from the World Economic Forum in Davos, they will be reflecting on how well the UK’s pro-business message landed with global investors. Attracting international capital and reinforcing the UK’s credentials as a place to do business will have been central to those conversations, particularly at a time when global politics feels more unsettled than it has for some years.
It was the first Davos since the Government launched “Invest 2035: The UK’s Modern Industrial Strategy”, a ten-year plan designed to position the UK as one of the world’s most competitive destinations for investment. It is an ambitious agenda, but there is a risk that one part of the investment story continues to be overlooked.
Industrial and logistics real estate rarely features in the headlines, yet it plays a decisive role in turning investment intent into economic reality. I’m of the view that as a sector, we are not always good at making that case confidently enough.
The UK has many strengths, from transport connectivity and legal and regulatory structures to deep consumer markets, a skilled workforce and institutions that overseas investors trust. Government engaging with the private sector on areas such as innovation, digital infrastructure and net zero transition has also helped reinforce the country’s appeal.
None of that matters much, however, if global businesses cannot find the physical infrastructure they need to operate efficiently. Warehouses, distribution hubs, urban logistics facilities and data centres sit behind almost every major investment decision. Without them, supply chains slow down, costs rise and growth plans stall.
The UK’s position as a centre for digital infrastructure underlines the point. Slough Trading Estate hosts the largest concentration of data centres in Europe. It reflects long-term investment in power, connectivity and planning certainty, combined with locations that work for occupiers. The same is true across logistics and advanced manufacturing.
Under the Industrial Strategy, the Government has identified eight growth sectors where the UK has a clear opportunity to attract capital and create jobs. Many of the businesses operating in those sectors rely heavily on industrial and logistics space. At SEGRO, our customers span seven of these growth sectors: advanced manufacturing, digital and technology, life sciences, defence, creative industries and professional services. Their operations depend on being close to consumers, labour and transport networks.
That dependency translates directly into overseas investment. Tokyo-based Yusen Logistics has committed £280m to a distribution hub at SEGRO Logistics Park Northampton, now its largest facility anywhere in the world. Germany’s DHL eCommerce has invested more than £230m in an automated hub at SEGRO Park Coventry. Dubai-based DP World has invested £34m in its largest UK warehouse on the same site, while Amazon spending £500m to create a new fulfilment centre on a plot acquired at SEGRO Logistics Park Northampton.
In Derby, Berlin-headquartered HelloFresh has opened its largest European distribution centre at SmartParc SEGRO, a specialist food manufacturing and logistics development designed to shorten supply chains and improve energy efficiency. And at Slough Trading Estate, more than 30 powered shells have enabled overseas based operators such as Virtus, Iron Mountain, Equinix and GTR, backed by international capital, to invest billions of pounds in data centres that now underpin large parts of the UK’s digital economy.
These occupier investments show how industrial and logistics estates support job creation, capital investment and the adoption of new technology. They also show something else that is talked about far less.
Listed companies such as SEGRO are a major route through which overseas capital is invested into UK infrastructure. Global pension funds, insurers and sovereign investors increasingly choose to invest via established, publicly listed platforms that offer scale, transparency and long-term stewardship. For many of them, this is a straightforward and trusted way to gain exposure to the UK economy.
As a result, the industrial and logistics sector supports two distinct but connected forms of foreign investment. It provides the space that allows international businesses to establish and grow their UK operations. At the same time, it channels long-term overseas capital into the assets that make that growth possible.
For investors entering a new market, certainty matters. Well-located estates with planning in place, power secured and infrastructure delivered reduce risk and speed up decision-making. Collaboration between the private sector, local authorities and national agencies has been an important part of that process in the UK, particularly for complex developments.
There is an opportunity here for government. Industrial and logistics real estate should be seen as part of the UK’s investment toolkit, not simply as a background asset class. Policy stability, planning clarity and a supportive regulatory environment send a clear signal to international capital.
When ministers talk about the UK being open for business, this sector has a strong story to tell which deserves to be heard more often, and more clearly.