Report: The drive for sustainability in warehousing
What does it take to deliver sustainability in warehousing? Our editor Karen Fletcher talks to the experts.
30 July 2025
Warehouses have been one of the strongest growth areas for the UK construction and property sector over the past ten years. Figures from Savills 1 show that between 2014 and 2024, the sector grew by 61%, accelerating to a 22% boost in the last three years.
What’s more, buildings in the sector also expanded in size to meet the demands of the logistics industry. Although warehouses under 500,000 sq ft still make up most of the stock, the development of warehouses over 1 million sq ft rose from 3% of the sector to 10% between 2015 and 2024.
The warehouse sector grew quicky in 2020, as the high street closed, shoppers stayed at home and the nascent online shopping sector matured rapidly and its warehousing needs expanded. Although that growth engine has decelerated, warehousing continues to play a critical role in the UK economy. Warehouse developments not only attract direct investment as financial assets, but they are also central to smooth-running supply chains of businesses of all sizes and types.
One important element of current and future growth in this sector is sustainability. As Savills notes in its 2024 sector report: “Whilst we remain confident of the continued growth story, the next decade will see greater emphasis on more strategic issues dominated by the Environmental Social and Governance agenda.”
This is echoed in a report from Knight Frank 2 which also highlights the warehouse sector’s growing sustainability focus: “In 2025, the UK's logistics property market is expected to experience steady investment and occupier demand, with a focus on high-quality developments and a moderation in rental growth. Investors and developers are likely to prioritise strategic acquisitions and developments that meet evolving occupier needs and sustainability standards.”
Putting sustainability into practice
But what does it take to deliver sustainability targets in the warehouse sector? These are large buildings, with cavernous indoor spaces and high roofs. They may include refrigeration sections and often have doors open for deliveries – setting a challenge for construction teams aiming for low energy and reduced carbon performance.
Arun Thaneja, Technical Services and Sustainability Director at Winvic Construction, says that the drive for sustainability targets in warehousing often comes from funds and developers, and they are consistently raising the bar.
“We are seeing a market shift. Five years ago, we were looking at targets of an Energy Performance Certificate (EPC) rating of A and a Very Good BREEAM rating. Over the last couple of years, we have seen that Very Good shift upwards to Excellent and more recently to Outstanding. The jump between Excellent and Outstanding is considerable,” he explains.
One thing is clear, achieving a target like BREEAM Outstanding or an EPC A takes planning and know-how. Thaneja highlights the importance of an in-house team with deep knowledge of the certification processes and metrics, as well as experience in how warehouses are used and operated.
“When we run a life cycle analysis of a building, and energy models for example, because we have been working on these units for so long, we know how they operate and what’s involved in them,” he says.
“We also have different metrics and data sets that we can use if there is a cold storage box, for example or a cross-dock system. We know what the M&E scenario is going to be and can also size the PV installation on the model.”
Case study: Greenbox Darlington - Winvic for Citivale
Net zero in construction in line with UKGBC Framework
BREEAM Excellent
EPC A
52% up-front carbon reduction (A1 to A5)
1209m2 of PV panels built with 100% future capacity
100% waste diverted from landfill
Air source heat pumps
The outcome is that the team has a clear idea of how the building will perform, allowing them to get an early view of what credits are potentially available for each project in the BREEAM rating system, for example. Knowing this early in the project is a key factor for success.
“Those factors need to be locked in at RIBA Stage 2 and Stage 3 if the project is to achieve a BREEAM Outstanding rating, so it’s important to get the credits locked in early,” says Thaneja.
Danny Nelson, Managing Director of Industrial, Distribution and Logistics at Winvic Construction, adds that investing in in-house expertise has been central to Winvic’s success in this sector.
“One of the many challenges that we faced, particularly with the concept of net zero in this sector, was a lack of understanding around how you got there, and that was from everywhere, from every part of the process from the developer, their consultants, the contractor, the sub-contractors.”
Nelson explains that five years ago, Winvic began to invest in developing that expertise in its own team and has gone on to share the knowledge with its supply chain and customers.
“We have a small and loyal supply chain who we work with closely. We thought that putting in the time and effort to educate them was well-placed. It enabled us to really give a full cradle-to-grave offering to our clients and their stakeholders and I think that’s really where we’ve succeeded.”
The carbon question
Knowledge of net zero is becoming more important to the warehouse sector. Decarbonisation and net zero are coming to the fore, with many of the certifications now converging around the measurement of factors such as embodied carbon, operational carbon and energy use intensity (EUI).
Thaneja says that, in the past, BREEAM has not touched directly on carbon reduction as part of its requirements, however this is changing as several well-known industry bodies bring their standards into alignment on this issue.
For example, with the launch of BREEAM version 7 in mid-July this year (in use from September) there is a closer link between achieving Excellent or Outstanding and RICS Whole Life Carbon Assessment Edition 2 – putting carbon reduction in warehouses front and centre.
“To achieve a BREEAM rating of Excellent or Outstanding under the new V7 metrics, there is going to be a requirement for developments to achieve an element of net zero across the whole building, or parts of it depending on the target rating,” he explains.
Winvic is working with the UK Green Building Council (UKGBC) and the UK Net Zero Carbon Building Standard on the new pilot versions, providing information on metrics and targets. This will also be aligning with BREEAM and RICS requirements.
Thaneja says this is vital for the industry: “Everyone has in mind the target date of 2035 for the UK to decarbonise its electricity grid. But the question is, how are buildings going to get there? With these metrics there is a route being mapped and each sector needs different expert input to get to those levels.”
Case study: Arc Royal Birkenhead - Winvic for Tungsten Properties
Net zero in construction in line with UKGBC Framework
BREEAM Excellent
EPC A
51.6% up-front carbon reduction (A1 to A5)
683m2 of PV roof coverage, with roof frame designed for additional PVs
100% of waste diverted from landfill
Back to nature – ecology and modern warehousing
With government mandates on biodiversity net gain (BNG), the issue is high on the agenda for developers. To support these regulatory requirements, BREEAM 7 has enhanced its focus on ecology and biodiversity, encouraging developers to enhance the local environment, not to simply avoid harm.
Thanjun says that achieving these targets needs careful consideration from the early stages of design: “You need to look at how you are going to enhance ecology – how you are going to meet the metrics. For example, concrete yards and steel frames will impact the ecology, so the question is how are you going to bring that back? We look at relocating trees or planting new as well as considering bird and bat boxes.”
There is also growing interest in providing outdoor spaces close to warehouses, including ‘trim trails’ for use by local residents.
The green future for warehousing
There is no doubt that the issue of sustainability in warehousing is here to stay. Cushman & Wakefield’s 2024 industry survey of the European market noted that sustainable warehouses, with BREEAM or LEED credentials, were commanding a 19% price premium, underlying the ‘flight to quality’ of investors and occupiers.
Danny Nelson says that the push for sustainability is now coming from several directions.
“Ten years ago, it was the leading industrial developers taking a proactive approach to building efficiencies, because there wasn’t really any legislation out there that pushed these buildings that way. The big developers were looking to prove the performance of these buildings because, of course, it also proved the investment value of these buildings, regardless of whether it was an occupier or speculative development.”
Nelson notes that even then, developers were using sustainable features mainly to market their warehouse projects: “At that time, buildings were being marketed as energy efficient or using renewable energy. It’s only really in the last five years, probably the last two years, where legislation has become more of a driver for the wider market to take on board these requirements."
He also highlights the role of end users, like the big retailers, who are seeking out warehouses that meet their corporate sustainability goals.
For companies with shareholders there is even more of an incentive: “They say, we only want buildings that align with our shareholders’ aspirations and the promises that were made to them so therefore we need buildings that are EPC A, BREEAM Outstanding, net zero in operation, net zero in construction,” says Nelson.
One of the future challenges facing the warehouse sector is what happens to ageing assets. Winvic focuses largely on new-build, but Nelson says that there is some movement in the market to refurbish older warehousing.
“There are still requirements out there for the older warehousing from operators who may not have these types of sustainable credentials at the forefront of their operations, so those buildings continue to be used. However, there are developers who are keen to acquire assets where they can redevelop by making use of the existing steel frame and existing concrete yards.”
Nelson says that these two features are often the key to saving embodied carbon: “If you look at the construction of the buildings, certainly in industrial, the biggest amount of embodied carbon relates to the steel frame and the concrete in the floor slab or in the externals. So, if you repurpose these buildings, upgrade the façade, put modern lighting in, and look in to putting renewables into them, you can certainly have a product that performs beyond what it did.”
However, it’s important to bear in mind that there are practical issues to bear in mind when looking at this sector in terms of refurbishment: “The problem with some of these (older) assets is that they are not the right height or they don’t have the yard size for modern logistics needs and the latest standards.”
Conclusions
Warehousing has become an increasingly sophisticated construction and property sector. The logistics industry is readily adopting the very latest AI and robotics technologies to support fast and efficient service.
But at the same time, it is also taking its environmental responsibilities very seriously and this is paying off for developers with clients paying a premium for premises with badges like BREEAM and EPC A. The SectorScope is also seeing an increasing number of projects coming through that are Net Zero in Construction and some aiming for Net Zero in Operation.
The UK Warehouse Association (UKWA) white paper 3 on the future of warehousing notes that: “Warehouses of the future will continue to serve as industrial hubs but also embrace sustainable construction and modular designs, being optimised for sustainability, aesthetics and long-term productivity.”
Construction and property professionals operating in the sector must embrace the net zero, energy efficient future of warehousing and ensure that they, and their teams, are prepared to tackle the challenges of certification from the earliest stages of design through to operation.
References
1. Savills
2. Knight Frank
3. UK Warehouse Association