As a result of this trend, there are said to be signs of increasing leasehold activity and higher rents in the Midlands' industrial and distribution market.
Mike Ward, industrial and distribution property specialist at BK, reports that companies which had been holding out to find a suitable freehold industrial or distribution unit are now being forced to lease buildings due to the lack of supply of quality freehold premises.
This comes at a time when many distribution businesses are growing and don't want to be tied down by traditional leases.
The demand for relatively short-term warehouse leases has prompted Industrious, Britain's second largest industrial property landlord, to set up a call centre to provide footloose occupiers with an instant update on vacant space.
It's part of the landlord's Flexilet flexible lease concept, which offers occupiers deals to suit short-term warehousing needs or to match the length of logistics contracts.
Back at BK, Mr Ward says: "We are experiencing an increased level of enquiries for leaseholds, which is making us cautiously optimistic about this part of the market.
"Companies are continuing to delay property decisions because of the on-going war in Iraq, but, they are beginning to recognise that a leasehold property is their only option when they do make a property decision."
According to Birmingham-based Mr Ward, certain sizes of freehold buildings are increasingly rare in the region. A recent search by BK for a freehold of between 10,000 and 15,000 sq ft along the M42 corridor revealed no current opportunities.
"The options on this size of freehold property with good quality build and good access are now severely limited," says Mr Ward.
"Generally, it is difficult to find quality freehold units in the 10,000-20,000 sq ft and 1,000 - 3,000 sq ft size ranges. There are very few smaller properties on the market at the moment, which indicates that smaller companies have been keen to buy and own their own premises."
According to Mr Ward, the lack of freeholds means that some developers are now prepared to consider selling rather than leasing new industrial units.
However, this change of attitude is unlikely to affect the market for small freehold units in the near future, as developers are concentrating on building large industrial and distribution units.
"There is a market opportunity for developers who would be prepared to construct and sell small freehold units. Such units would, without question push, at the boundaries of freehold prices," says Mr Ward.
According to Mr Ward, increased interest in leasehold properties is buoying up rental values across the West Midlands. In Birmingham, prime rents are holding steady at #5.75 per sq ft and some deals have topped #6 per sq ft.
"Given current market conditions and provided the war in Iraq is over in reasonable time, I see no reason why the #6 barrier should not be breached on a more regular basis in the coming months," says Mr Ward.
Rents have also firmed up in the Black Country, where prime rents are now topping #5 per sq ft in good locations on the Black Country road network.
"The Black Country still offers great value for money compared to Birmingham, especially considering it has such good links to the motorway network," he says.
BK reports increased interest in the leasehold properties which it has on the market. These include 63,236 sq ft at Berry Hill Industrial Estate, Droitwich - comprising one unit of 20,224 sq ft, where the asking rent is #93,000 a year, and a 43,012 sq ft unit with an asking rent of #120,000.
At Industrious, the new call centre can identify three units at Hartlebury Trading Estate, near junction six of the M5 in Worcestershire, that are suitable to meet the needs of short or longer term logistics contracts.
They range from Unit Ten, with 77,616 sq ft of warehousing and 6,362 sq ft of offices, to a newly-built unit which measures up at 42,785 sq ft of warehousing and 2,925 sq ft of offices.
Regional property manager Diane Moore describes her company's Flexilet concept as the ideal solution for the fast-moving logistics industry. "Our research has shown that the majority of distribution companies do not want the constraints of a traditional lease," she says. "Businesses grow with new contract awards and then often need the flexibility to change premises accordingly."