Figures from Savills latest Big Shed Briefing show that the East Midlands continued to dominate the UK logistics market in the first half of 2026, accounting for 38% of national take-up. Activity in the region reached 5.8 million sq ft across 23 units, according to the international real estate advisor. This represents a 137% increase on the same period last year and is 141% above the pre-Covid average recorded between 2015 and 2019.
This strong level of take-up further consolidates the East Midlands’ position as the UK’s leading logistics market, despite wider economic headwinds over the past 12 months, which have created challenges for some occupiers and slowed decision-making. According to Savills, the region’s continued dominance is underpinned by its less land constrained nature, strong motorway connectivity and proximity to key logistics corridors, including the M1, which continue to make it an attractive location for major distribution centre operators.
Savills states that available supply in the East Midlands currently stands at 11 million sq ft across 49 units. This reflects a 30% decrease over the past 12 months, while the vacancy rate has fallen by 337 basis points to 7.51%. Based on historic demand levels, the region now has just 1.24 years’ worth of stock remaining. The real estate advisor expects this to reduce further, with 1.3 million sq ft of existing units currently under offer across the region.
Savills also points to increasing demand for XL Grade A logistics units. However, across the East Midlands, availability remains constrained, particularly across certain size bands. As of the end of June, only four existing XL units were available, of which just one was Grade A, at MPC2.
The data also highlights a clear preference for best-in-class assets, as the sector continues to see a flight to quality. In H1 2026, 50% of space let was newly built speculative development, while 18% was Grade A build-to-suit development and 4% was let before practical completion. This means Grade A space accounted for 73% of total take-up, signalling a continued preference among occupiers for buildings with stronger ESG credentials. The remaining 27% of space transacted was second-hand stock.
Despite challenging development and funding conditions, Savills recorded more than 1.06 million sq ft of build-to-suit activity in the East Midlands during H1 2026, accounting for 18% of the region’s total take-up. This is a positive indicator of occupiers’ long-term commitment to the region. Savills notes that further build-to-suit deals are currently progressing and are expected to come forward later this year. This continued commitment to bespoke development also reflects the limited availability of existing Grade A units, with many occupiers seeking tailored solutions to meet specific operational requirements.
So far in 2026, only 230,000 sq ft of speculative development has completed. Of the 2.7 million sq ft currently under construction, just 9% is scheduled to complete in H2 2026, with the remaining 91% due in 2027 or later. This leaves active requirements with limited near-term options and supports Savills confidence in the region’s fundamentals. Savills forecasts annual rental growth of 2.1% through to 2029 under the baseline scenario, rising to 2.7% in the optimistic scenario.
David Tew, Director, Industrial, Savills Birmingham, comments, “Despite challenging speculative development and funding conditions, development activity continues, with space under construction up 108% since the end of 2025. However, emerging shortages of Grade A stock across key locations and size bands are increasing the risk of a future supply crunch, creating opportunities for well-positioned developments. The East Midlands’ strong fundamentals, strategic location and sustained occupier demand mean we remain optimistic about the region’s outlook.”
