Can the planning system provide the logistics space needed to meet demand?

Revised national policy shows support for meeting the logistics sector's space needs, but experts anticipate continuing struggles to secure planning consent, Mark Wilding reports.

Distribution centres: consultants say the planning system is not keeping up with demand
Distribution centres: consultants say the planning system is not keeping up with demand

To use the informally accepted unit of measurement for storage and distribution "sheds", the Amazon warehouse in Tilbury, Essex, is the size of 38 football pitches. The 204,000 square metre Tilbury facility is just one of 16 "fulfilment centres" operated by Amazon in the UK, and the company continues to expand every year. It is not unique.

According to research by consultancy Savills, take-up of industrial and logistics space by online retailers has grown by 731 per cent since 2008. According to planning experts, this rate of development presents a problem. "In the majority of places throughout the UK, demand for storage and distribution greatly exceeds the supply of suitable sites," says Ben Taylor, planning director at consultancy Barton Willmore. Essentially, says Taylor, the planning system has been unable to keep up with the logistics sector’s rapidly increasing size: "Part of the problem is the slow pace of the planmaking process, which is at odds with the recent rapid growth in the market."

It is not just the pace of growth that poses a challenge. Taylor says the changing demands of industrial occupiers in recent years, in terms of unit sizes, access to labour and proximity to the road network, mean many designated employment sites are no longer fit for purpose. Some have been reallocated for housing. That is fine, says Taylor, but only if more employment sites are designated elsewhere. "A balance must be maintained between housing and employment land. This has not occurred," he adds. Jo Russell, a director at consultancy Turley, says development plans rarely allocate enough sites for industrial and logistics uses. "The delivery of distribution centres is more and more planning application-led," she notes.

That creates risks for applicants who cannot be sure whether schemes will be viewed favourably by planning authorities. Prologis is one of the largest developers and owners of warehouses in the UK. Senior vice-president Robin Woodbridge says local authority attitudes to warehouse schemes are mixed. "We engage with some authorities who understand the value in logistics a lot more than others," he says. "Some authorities really don’t see the value. We still struggle with the whole perception about labour. There’s still this perception that these buildings don’t employ anybody, which couldn’t be further from the truth."

That is a view echoed by Taylor. "A recurring issue is the somewhat outdated view that storage and distribution uses only provide menial jobs at low densities," he says. "This misconception presents issues when presenting the planning case to local authorities, whereby you are relying upon the economic benefits to outweigh tra?c and amenity impacts. Often this results in local authorities prioritising higher-density uses on designated sites."

Even in areas where councils take a positive view of the logistics sector, local residents still need to be won over. James Arnold, strategic director of place at North West Leicestershire Council, says his authority has a history of supporting logistics developments and has worked with neighbouring authorities to produce a joint evidence base to ensure the sector’s needs are met in local plans. Arnold says the council works with applicants to mitigate potential impacts through design, landscaping and noise attenuation measures.

Likewise, Eleanor Gingell, senior planning o?cer at South Northamptonshire Council, says: "Public perception of logistics is still a major issue. Lorry parking and additional tra?c are key concerns, particularly in an area like ours where rural roads are not always appropriate for the levels or types of tra?c generated. This has to be carefully managed and monitored."

Not all warehousing applications are determined locally. Some, such as the Northampton Gateway scheme in South Northamptonshire, are linked to strategic rail freight interchanges and thus qualify to be considered under the nationally significant infrastructure regime, with development consent order decisions made by the secretary of state.

At the local level, paragraph 82 of the revised National Planning Policy Framework, issued in July, introduces specific support "for storage and distribution operations at a variety of scales and in suitably accessible locations". Taylor says this is a step in the right direction. "The challenge now, however, is to ensure that national policy guidance is carried through, with site allocations in the right locations for the market in local plans," he maintains. That will mean both councils and communities signing up for growth in the logistics sector.

Woodbridge says securing consent is partly about addressing the most commonly raised concerns: visual impact, noise and trafic. "We try really hard to mitigate these, but they are di?cult. You can’t hide a one-million square foot building. We work really hard on the external appearance of our buildings. We’ve been trying to introduce more glazing. We also look at tra?c movements, so we’re looking at car sharing." But he says making adequate future provision might also mean starting to think about logistics projects in a different way – for example, by weighing up the costs of not planning for growth. "If metropolitan areas can’t provide goods to the people who live there, that’s an issue," he adds. "I don’t feel our planning process really thinks about that."

Awaiting decisions: two major applications

SCHEME: Magna Park expansion
LOCATION: West of M1 junction 20, near Lutterworth PROPOSAL: Up to 420,000 square metres of storage and distribution buildings, offices, a 3,700 square metre logistics institute and a country park KEY ISSUES: Developer IDI Gazeley submitted plans for the expansion of Magna Park near Lutterworth in October 2015. Members of the public submitted 575 objections to the scheme, raising concerns around traffic, air quality, noise and light pollution. Harborough District Council officers advised that "the clear and substantial public benefits of the proposals" would "significantly outweigh" the harm. Outline permission was granted in November 2017. However, the application was subsequently called in by a group of councillors, in line with the authority’s constitution, and the permission was rescinded. The plans were rejected again at a committee meeting in January 2018. IDI Gazeley has lodged an appeal.

SCHEME: Northampton Gateway (pictured, top right)
LOCATION: South-west of M1 junction 15, near Towcester
PROPOSAL: Rail freight interchange including up to 557,000 square metres of warehousing and supporting infrastructure KEY ISSUES: Developer Roxhill submitted a development consent order application to the Planning Inspectorate in May 2018. The application was accepted in June and will be assessed in accordance with the National Policy Statement for National Networks. This document sets out the government’s view that a network of strategic rail freight interchanges is necessary to facilitate the transfer of freight from road to rail and "has an important part to play in a low-carbon economy and in helping to address climate change". In total, 848 relevant representations were received from members of the public, businesses, councils and statutory consultees. An examination of the application is due to begin in October and a ministerial decision is expected in 2019.

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