The Co-op is in negotiations to build a 600,000 sq ft distribution centre at Stansted Airport in Essex to service its growing store estate in London and the South East.
The retailer is in discussions with the airport’s owner Manchester Airports Group about constructing a unit on unallocated land at the site.
It is understood that the Co-op has drafted in industrial developer Stoford to work on plans for a new build-to-suit facility.
The unit will support the Co-op’s store expansion programme, which will see it invest £70m in opening more than 100 new convenience outlets this year, predominantly in London and the South East.
The Stansted Airport site is believed to be the grocer’s preferred option, ahead of schemes in Peterborough and Bury St Edmunds, due to its location close to the M11 motorway and access to skilled staff in the area. The rent is expected to be around £7/sq ft.
The Co-op has been on a major drive over the past 12 months to expand its footprint across the country. Last year, more than half of all new food retail openings from the major supermarkets were Co-op stores.
To support its growing estate, the retailer has already expanded its distribution network.
Only last month it secured a 100,000 sq ft letting at Bericote and BlackRock’s logistics scheme in Thurrock, Essex, to complement its nearby 325,000 sq ft facility.
It took the third and final speculative unit at Tower Thurrock, joining Amazon and office supplies company EBB at the development.
The Co-op’s aggressive growth plans come as the ‘big four’ supermarkets - Tesco, Sainsbury’s, Asda and Morrisons - scale back their own plans.
However, discount retailers Aldi and Lidl, which between them have an 11.7% slice of the UK’s grocery market, have similar expansion plans, each planning to open between 60 and 70 stores a year over the next few years.
Lidl recently opened its 11th regional distribution centre in the UK at Wednesbury in the West Midlands and has plans for further warehouses in Exeter, Doncaster and Bolton.
In November 2015, it committed to investing £1.5bn over a three-year period in expanding its warehouse and 650-strong store portfolios in the UK.
Also looking to expand on its nine distribution centres, Aldi is thought to be scouring for sites around the Midlands section of the M1 motorway.
Matthews & Goodman advises the Co-op. All parties declined to comment.
24 April 2017
17 March 2017
3 March 2017
17 February 2017
5 January 2017
25 September 2015