Jason Rockett is managing director of business parks firm Potter Space
A year into Labour’s term, we’ve been reflecting on how their agenda is reshaping the industrial and logistics sector—and what still needs to happen.
It’s been a year of both challenges and cautious optimism. There have been ongoing hurdles, with National Insurance increases, tax pressures and persistent funding gaps all making life difficult for developers and investors alike. In Yorkshire, where industrial space is already in short supply, these challenges feel especially acute.
The planning system remains the single biggest barrier to unlocking development potential across the country; at Potter Space we recently waited nearly two years for approval of a scheme of small industrial units on our existing and well-established business park. We have seen signs of progress over the past 12 months that the government is listening. The ambition behind the governments planning reform recognises the urgency of accelerating planning decisions. However, the governments initiatives to unlock planning need to be replicated at a local and regional level. Authorities need to act more decisively which requires greater resource, collaboration with key stakeholders and local politicians having a better understanding of the planning process. Without it, we won’t unlock the development the country needs. Regional mayors could play a key role in breaking the political deadlock, especially if they work collaboratively to align planning priorities and infrastructure delivery.
The current pattern is to see small to mid-box industrial hubs disappearing from urban centres, often replaced by residential developments.
While we appreciate and welcome the need for more housing, the issue with this is that for every new home built, there is a requirement for 109 sq. ft of industrial land to meet infrastructure needs such as employment, supply chain and logistics*. This insight emphasises the need for coordination across residential and commercial planning.
Power availability is fast becoming a critical issue for industrial developers. Without access to reliable and affordable energy, plans for new, sustainable sites simply stall. The government’s commitment to double onshore wind, triple solar, quadruple offshore wind by 2030** as part of the push to a zero‑carbon electricity system by 2030, and net‑zero by mid‑2050, is welcomed not only for the climate but for controlling costs and national energy security. The private sector stands ready to deliver, but we need faster grid upgrades and more joined-up thinking between national schemes and local implementation.
The sectors championed in Labour’s Industrial Strategy, like defence, life sciences, clean energy and advanced manufacturing will require high quality, well located and sustainable industrial property if they are to drive success for the UK globally. Developers and investors will aim to respond to this opportunity but challenges like power availability and labour shortages need to be addressed strategically and collaboratively. While the I&L sector is recognised in the Industrial Strategy, overall, it is underplayed how much of a vital role it plays as the backbone of the UK economy and responsible for 7% GVA.***
Looking ahead, we’re optimistic that the next phase of the industrial strategy will embrace a truly joined-up approach. Policy clarity on Digital Planning Zones, for example, could unlock faster regeneration while ensuring essential logistics space is also considered. Alongside this, Chancellor Rachel Reeves announced the introduction of the “British Industrial Competitiveness Scheme” from 2027, this will cut electricity costs for 7,000 energy-intensive businesses.**** This has been a long-standing ask from the industry, so although it’s not immediate, it’s great positive progress to see the government acting on this.
Ultimately, we have an opportunity to see our sector flourish and power sustainable growth with the right policy mix. Government has a real chance to shape thriving regional economies for years to come and leave a lasting impact for the next generation. We’re hopeful about what year two could bring.
* Potter Space’s BIG Things in SMALL Boxes report 2024
** https://lordslibrary.parliament.uk/renewable-energy-costs/
*** Potter Space’s BIG Things in SMALL Boxes report 2024
