The UK Logistics Real Estate market was valued at USD 44,500 Million in 2025 and is expected to reach USD 97,800 Million by 2035, growing at a CAGR of 7.6% from 2024 to 2035. Rising e-commerce penetration and demand for last-mile delivery solutions are fueling robust growth, with major companies such as Segro Plc and Prologis UK actively expanding their portfolios to meet evolving consumer and business needs.
The economic impact of tariffs on "UK Logistics Real Estate".
UK Logistics Real Estate Market Growth Drivers
Booming E-commerce and Omnichannel Retail: The surge in e-commerce has led to unprecedented demand for logistics and warehouse spaces across the UK. Companies like Amazon UK and Ocado Group are continuously investing in new fulfillment centers and last-mile delivery hubs to ensure rapid delivery and efficient distribution, spurring significant growth in logistics real estate. This demand is accentuated by consumer expectations for same-day and next-day delivery, pushing companies to secure more urban logistics assets and fueling the sector’s expansion.
Emergence of Automated and Sustainable Warehouses: There is a marked trend towards building smarter, greener warehouses equipped with cutting-edge technology and energy-efficient solutions. Leading players such as Segro Plc are installing solar panels, EV charging stations, and robotic automation within their real estate portfolios. These initiatives not only help them attract high-quality tenants focused on ESG (Environmental, Social, and Governance) compliance but also position the market for sustainable and long-term growth.
UK Logistics Real Estate Market Trends
Adoption of Smart Warehousing Solutions: Growing implementation of IoT, artificial intelligence, and robotics in UK logistics facilities is revolutionizing property management and operational efficiency. Prologis UK has notably integrated advanced inventory tracking systems and AI-driven logistics platforms in its majority assets, optimizing tenants’ supply chain visibility and minimizing errors, which becomes increasingly critical with the growth of online retail and higher parcel volumes.
Growth of Urban Logistics and Last-Mile Delivery Hubs: Urbanization and shifting consumer habits are driving demand for logistics real estate closer to city centers. Companies like GLP and Prologis UK are leading investments in city-edge properties and last-mile distribution centers in London, Manchester, and Birmingham, helping retailers speed up delivery cycles, reduce logistics costs, and meet environmental targets. This trend is shaping new real estate construction and redevelopment in densely populated urban areas.
UK Logistics Real Estate Market Opportunities
Redevelopment of Obsolete Retail and Industrial Sites: There is significant potential in transforming underutilized or outdated commercial spaces into modern logistics hubs, especially close to population centers. Real estate firms such as Tritax Big Box are capitalizing on this by acquiring defunct premises and repurposing them for high-demand warehouse use.
Expansion Linked to Green Logistics Solutions: Heightened ESG requirements and government incentives are prompting further investment in eco-friendly logistics real estate, providing opportunities for landlords to differentiate themselves with low-carbon, renewable-powered assets attracting premium tenants.
UK Logistics Real Estate Market Revenue (USD Million), 2020-2035
The UK logistics real estate market demonstrates robust and steady growth from 2020 to 2035. Beginning at USD 28,300 Million in 2020, the sector experiences a pronounced revenue expansion amid accelerating e-commerce and logistics activities, reaching an estimated USD 44,500 Million by 2025. The forecast shows a sustained upward trajectory, with the market size expected to almost double by 2035, reaching USD 97,800 Million. This trend underlines persistent demand for warehouse and distribution center space, driven by technology integration, sustainable building practices, and the rise of last-mile delivery needs. An increasingly tech-savvy, urban population ensures further market resilience heading into the next decade.
UK Logistics Real Estate Market by Regions Share (%), 2025
In 2025, the UK logistics real estate market is concentrated primarily in the South East, which commands 29% of the national share due to proximity to London and major ports. The Midlands region follows with 24%, benefiting from its central location and excellent transport infrastructure. The North West represents 18%, owing to strong industrial and e-commerce investment in cities like Manchester and Liverpool. The East of England constitutes 15%, and Scotland holds 14%, indicating regional diversification yet a continued urban-centric approach to logistics real estate development.
Recent Developments in UK Logistics Real Estate Market
In March 2024, Segro Plc announced the acquisition of a 500,000 sq ft urban logistics park in Greater London, designed with advanced solar and rainwater harvesting technologies. The park is purpose-built for rapid grocery delivery, reflecting Segro’s commitment to sustainable, future-ready property assets and strengthening its portfolio in one of Europe’s largest urban markets.
April 2024 saw Prologis UK launch a new build-to-suit distribution centre in the Midlands, designed specifically for an e-commerce giant. The facility integrates robotics and real-time monitoring, supporting the tenant’s rapid expansion and the increasing need for automated, high-throughput logistics solutions amidst rising parcel volumes.
GLP secured planning consent in May 2024 for a 75-acre multi-modal logistics park near Manchester. With dedicated rail and road connectivity, the project highlights GLP’s strategy to cater to the evolving requirements of the North West region, emphasizing multi-modal access and boosting the region’s competitiveness as a logistics hub.
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