Newport is well located on the prime M4 corridor but is so often overshadowed by neighbours Bristol and Cardiff.
However, one sector where the city is leading from the front is the industrial property market with promising signs of growth and development. There is significant progress in key areas, painting a picture of a robust and evolving market.
One of the most notable success stories is St Modwen’s, speculative development programme at St Modwen Park, Llanwern, located adjacent to the dual carriageway which runs through the steelworks. The Llanwern redevelopment spans 600 acres which is mainly residential, with 100 acres dedicated to employment land uses.
Since 2016, St. Modwen has developed a series of speculative, large-scale and highbay industrial buildings, marking a significant investment in Newport’s commercial infrastructure.
The progression of rental values in this development illustrates the increasing value and demand for industrial space. In 2016, the first 50,000 sq ft unit was let to Amazon Logistics at £5.50 per sq ft. Fast forward to 2021, and the rate had risen to £6.50 per sq ft. Over the past three years rents have accelerated with the last three lettings at £8.50 and £8.75 per sq ft. Quoting rents are now £9.75 per sq ft with one of the last remaining units under offer at or close to this.
These figures highlight not only the strong demand but also occupier confidence in Newport’s industrial market. Achieving £8.75 per sq ft for a 116,000 sq ft building underscores the substantial interest in new highbay energy efficient industrial floorspace. Occupiers secured to date include Aerfin, Genpower and Mitel Networks. The 100-acre site will soon be fully developed and the challenge for the planning authority is to allocate another site of similar scale.
On the western side of Newport, Imperial Park has witnessed major developments that further cement Newport’s status as a growing industrial hub. Two significant projects stand out:
KLA’s R&D Facility
Newport has been home for many years to the R&D and advanced manufacturing arm of KLA’s SPTS division, a global supplier of tools for advanced wafer processing for the semiconductor industry.
NASDAQ-listed KLA’s Newport operation is currently based at The Coldra on Junction 24, M4 but the company has acquired 22 acres at Imperial Park from Welsh Government. KLA has developed a new £100 million facility with clean rooms to accommodate 750 staff. This investment not only brings high-tech jobs to the area but also enhances Newport’s reputation as a centre for semiconductors and technological innovation.
Microsoft’s Data Centre
In a move that highlights the region’s strategic importance, Microsoft acquired the 40 acre former Quinn Radiators site with planning permission granted in July 2024 for two data centres totalling 750,000 sq ft. This development aligns with the broader trend of increasing demand for hyperscale data centre space, driven by the growth of AI, cloud computing and digital services. The presence of such a major global player, already a major customer of Vantage in Newport, is a significant boost for Newport, positioning it as a critical node in the global digital network. However, it brings further challenges to a constrained regional power grid.
Imperial Park is now home to KLA, IQE compound semiconductors, and data centre operators Vantage and Microsoft. This location should be prominent in the emerging Investment Zone which was announced by UK Government for Newport and Cardiff in the spring. Indeed, one of the challenges will be securing sufficient expansion land to fully capitalise on this cluster.
The combination of speculative developments and high-tech investments paints a bright future for Newport’s industrial commercial property market. The steady increase in rental rates at the Llanwern redevelopment and the significant projects at Imperial Park demonstrate the area’s attractiveness to both local and international businesses.
These developments not only create jobs but also stimulate further economic activity, drawing more businesses and investors to Newport. The strategic location, coupled with robust infrastructure and a growing reputation for innovation, makes Newport an appealing destination for industrial and high-tech enterprises.
