Industrial property development in the UK: A regional analysis of new orders

Summary This paper presents an empirical investigation of new orders for industrial buildings at the regional level in England. It aims to examine the extent to which common determinants exist of industrial new orders across regions. A uniform pattern in modelling new orders in terms of dynamic specifications and explanatory variables does not emerge from the findings of the present study. This may be attributable to the distinctive economic and institutional contexts in the regions considered. However, the effects of regional economic conditions proxied by GDP, manufacturing employment and unemployment and trends in the industrial property markets as captured by rents, dominate in explaining new orders. This implies that the production of industrial space is the result of both the accommodation requirements of owner‐occupier firms and development decisions of property developers/investors who respond to the returns that industrial property yields. The South East proved a difficult region to model. Financial considerations, probably reflecting the ways that property development is financed in this region, appear to be relatively more important.