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Could the rise of dark kitchens fuel demand for small industrial units in high density urban locations?

Dark kitchens offer an alternative for restaurants that want to expand their businesses and meet increasing consumer demand, without opening expensive high street premises; it also enables them to reduce the impact on customer’s experience who are dining in restaurants. Expansion plans are data driven, based on popular postcodes, restaurants and online food delivery companies can meet demand by using this data and locate their dark kitchens accordingly. These locations are often in industrial spaces in high density urban locations. Deliveroo was the first online fast food delivery company to roll out dark kitchens as a way to meet the rapidly rising online demand for their food delivery service.

This platform allows restaurants to offer food delivery in locations where they do not have a physical presence. As the roll out of the dark kitchens expands, these hubs are appearing in many locations across the UK. This in turn could fuel demand for small industrial units in high density urban locations.

Wrenbridge and Palmer Capital recently acquired a site of two acres in Ruislip, which is located within close proximity to the A40. Planning has been granted to deliver a speculative industrial scheme of 47,104 sq ft comprising seven units, ranging from c.2,500 sq ft to c. 25,000 sq ft. The scheme is funded through the Palmer Capital Development Fund IV, a programmatic venture managed exclusively on behalf of clients of CBRE Global Investment Partners (‘CBRE GIP’). The scheme will aim to target a range of occupiers from traditional industrial operators, trade counters and dark kitchens. Works for the scheme are due to commence imminently and practical completion of the scheme is due in Q2 2020.  Wrenbridge are focusing on investing in enhancing specification and building to future proof for occupiers of the future, in order to provide flexibility going forward. They are also taking staff welfare and sustainability measures into consideration within their development.

Chris Button of Palmer Capital commented:

“This development illustrates our continued support in funding new industrial schemes in well connected, urban locations where supply has been adversely affected by commercial land reverting to alternative uses.”

James Feltham of Wrenbridge noted:

“We are excited to be delivering the first small unit speculative industrial development in this part of West London for a number of years. We believe the scheme delivers the flexibility to suit a range of different occupiers and the additional investment we are making in the specification will future proof the buildings.”

Wrenbridge and Palmer Capital have other requirements of this nature and are actively looking for sites of 1-10 acres in urban locations, where they can deliver more schemes like the Ruislip development project.

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