Developers with a strong corporate social responsibility policy will drive demand for low energy-use buildings in the UK industrial sector, it was claimed today.
Forthcoming EU legislation on energy efficiency is likely to have little immediate impact, according to property adviser DTZ.
In its Green Sheds report, which looks at the impact of the planned changes, DTZ predicts that initial demand for "green sheds" is likely to come from a small number of occupiers at the top end of the market.
A lack of financial incentives, such as stamp duty or tax breaks, or specific penalties for non-compliance, will mean that the real impact of the legislation will be minimal across the rest of the sector.
However, as corporate environmental policies become more widespread, demand for energy efficient buildings will extend.
The introduction of a certification system, which will allow comparisons to be made between different buildings according to their energy profile, is likely to become a measure of a company's commitment to its social and environmental responsibilities.
Increased awareness of the cost savings that occupying an energy efficient building bring to businesses will also drive demand.
DTZ Research indicates that average energy costs currently represent approximately four per cent of the rental value of an industrial property and whilst this is not a high proportion of total costs, it is a substantial outgoing, in particular for larger warehouse buildings.
The issue of savings will come more sharply into focus if energy costs continue to increase, and begin to drive demand.
Simon Lloyd, director of the national industrial and logistics team at DTZ, said: "A commitment to environmental policies and corporate social responsibility by developers may pay dividends in the long term as green policies become more widespread and industrial buildings, in particular warehouses, risk obsolescence and increased penalties for energy inefficiency in the future."
Meanwhile ProLogis Developments is to speculatively develop over 4.5 million sq ft of warehouse space in 12 buildings within the next 12-months. The new distribution warehouses are in strategic and key distribution locations in the East & West Midlands, Yorkshire ( Wakefield) and further south at Dunstable and Swindon; some are underway for completion by the end of this year and others will start in the next few months for completion by the spring of 2006.
ProLogis says it recognises the need to provide more new and larger warehouses for its customers.
UK managing director Alan Curtis said: "We got off to a cracking start this year with deals close to 1.5 million sq ft and this boost to our speculative programme will add to our tremendous successes and record last year, when deals of over 3.4 million sq ft were achieved.
"In terms of take up, 2005 is showing signs of levelling off but our speculative programme will allow us to achieve our objective of consistently having new and the right product available at the best locations and when our customers tell us they will be ready for them."
The buildings will be developed on part of the land bank that ProLogis has assembled over the past 18 months in the Midlands, South-east and the west of London.