Sheds UK 2026: Demand is Strong, but Delivery remains the Challenge

The overriding message from Sheds UK 2026 was clear: industrial and logistics occupier demand remains resilient, but bringing new space to market is becoming increasingly difficult. Across the investor, developer, agent and occupier panels there was broad agreement that the sector's long-term fundamentals remain strong, with continued demand from manufacturing, e-commerce, urban logistics and parcel operators, alongside emerging demand from AI-driven businesses, data centres, defence and Chinese occupiers.

Despite wider economic uncertainty, the tone of the conference was generally positive. The agency panels highlighted falling vacancy rates in several markets, particularly within the East Midlands big-box sector, together with continuing rental growth in the strongest locations. Modern, well-specified buildings continue to outperform, with occupiers prioritising operational efficiency and overall occupational costs rather than headline rent alone. Around 70% of take-up during 2025 was reported to be in new units, underlining the premium attached to modern space.

However, the principal challenges discussed throughout the day were on the supply side. Capital remains available but increasingly selective, with investors focusing on quality assets, secure income and deliverable business plans. Planning reform was broadly welcomed, but many speakers questioned whether policy changes are yet translating into faster delivery on the ground. Competition for land from housing, logistics and data centres is also becoming increasingly acute.

One of the strongest themes to emerge was the growing importance of power infrastructure. Grid capacity, connection delays and increasing electricity requirements from data centres, automation, EV infrastructure and advanced manufacturing were repeatedly identified as development constraints. The message was clear: power can no longer be treated as a technical issue to be solved later in the development process. It is now a fundamental commercial consideration.   

A particularly interesting feature of the conference was the "golden thread" question posed to every panel:

"In 2030 the industrial and logistics market will be..."

Although the answers varied, several themes consistently emerged. The market was expected to become increasingly shaped by AI and automation, more dependent on power infrastructure and technology, and more collaborative between investors, landlords and occupiers. Many speakers also emphasised that, despite the pace of change, location, specification and building quality would remain the defining characteristics of successful assets.

The clearest takeaway from the conference was that demand is not the issue. The challenge for the sector is whether planning, infrastructure and capital markets can keep pace with it. For now, resilient occupier demand, falling vacancy rates and rental growth in key markets provide strong grounds for optimism, a welcome message in the current market environment.