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  • London's population is set to increase from 8.7 million to over 10 million by 2031 – the equivalent of Birmingham and Coventry moving to the capital
  • The loss of industrial land for other uses expected by the GLA by 2031 could be achieved in 2017
  • Equivalent to losing 7,800 new jobs per year
  • The industrial and logistics sector is the cog that keeps London moving
  • Strategic review of developed land in London urgently needed

SEGRO plc (“SEGRO”) today (2 February 2017) released the Keep London Working report, prepared by Turley, which provides a critical look at the importance of industrial space in London and the crucial role it plays in supporting the capital play provides future economic and population growth. The movement of goods to and from people and businesses keeps London moving and helps make it a thriving global city.

London is a thriving city and as the capital grows, so does the need for businesses to get their goods and services to their customers, with consumers expecting certain deliveries within the hour. London's population is projected to increase from 8.7 million to over 10 million by 2031, matching the population of Birmingham and Coventry moving to the capital. This combined with technology has led to an explosion in e-commerce and increased demand for commercial space to ensure we can deliver all our goods.

Logistics plays an increasingly important role in connecting people and businesses with goods. However, the evidence suggests that as the population grows, the scale of activity must increase, and this will prove difficult if the critical land needed to create the necessary facilities remains scarce.

Population growth is also having an additional impact on the availability of housing. However, industrial land is being lost rapidly, often for residential use, at three times the rate predicted by the Greater London Authority (GLA). At the current rate of decline, the GLA's projected release of commercial space by 2031 could be achieved this year. Industrial land loss is taking place across all London boroughs, with the greatest impact in Newham, Greenwich, Bexley and Wandsworth. The boroughs with the greatest estimated losses since 2001 are Newham, Havering and Tower Hamlets.

The logistics industry is also working hard to address the problem of poor air quality in London. Emissions from light commercial vehicles account for a very small proportion of total emissions, accounting for less than 4% of carbon dioxide. Innovative solutions will be implemented to improve environmental sustainability within the sector, including electric vehicles, delivery timing, use of reverse logistics and the development of sustainable buildings.

David Sleath, CEO of SEGRO said:

“A robust and flexible logistics infrastructure is key to making London work. Halting the loss of industrial land is very important to create employment opportunities and a landscape for the emergence of new businesses.

“As a result of the report, our call to action, endorsed by the British Property Federation, is to conduct an immediate strategic review of developed land, coupled with a full and comprehensive needs assessment.

“There needs to be a thorough review of commercial zoning that recognizes the location requirements of city logistics companies to respond to last-mile activity.

"We need to ensure the industrial and logistics sector has a voice in London policy-making to ensure that the rapid loss of industrial land is reversed and an intensification of industrial and logistics use is possible where practicable."

London First Chief Executive Jasmine Whitbread said:

“London's industrial heartland is home to e-commerce companies, technology start-ups and companies that are vital to supplying the city with goods and services. So we need to make sure London has the capacity to accommodate these businesses along with the people who support and employ them.”

Melanie Leech, Chief Executive, British Property Federation said:

“The industrial and logistics sector is an important part of our modern economy, but the important role it plays in our everyday lives is often overlooked. The provision of commercial space not only ensures that online deliveries arrive on time, but also creates skilled jobs and ensures significant economic growth. Competition for land in London is intense and there is an acute housing shortage, but we need a balanced approach. Sustainable communities need both homes and the right infrastructure to provide services, facilities and jobs support this initiative and SEGRO's recommendations.”

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