EXCLUSIVE: BAE Systems set to take Northwest Mega shed
Defence company BAE Systems is strongly believed to have put Tungsten Properties and Tristan Capital’s circa 500,000 ft2 Arc 500 cross dock facility in Liverpool under offer.
By Liza Helps, Property Editor, Logistics Matters
THE DEAL comes within two weeks’ of Prime Minister Keir Starmer’s announcement that the UK government has pledged to meet a new NATO’s defence target to spend 5% of the UK’s GDP on national security by 2035. The Government has already announced that it would increase defence spending to 2.5% by 2027 as part of its Strategic Defence Review published earlier this summer.
The Arc 500 scheme totals 497,201 ft2 and was speculatively built in 2023/24. It is cross docked with two 50m yards and 360 circulation, and was built on the former Ark Royal site in Birkenhead. It sits in the Liverpool Freeport where occupiers can, subject to status, secure tax and customs benefits up to £15 million.
It is thought that BAE Systems will use the facility to serve a contract with the Ministry of Defence on its submarine projects specifically the SSN-AUKUS program, which will see the joint partnership of the UK, US and Austria develop the latest class of nuclear power submarines. AUKUS is a defence and security partnership between Australia, the United. Kingdom and the United States, announced in September 2021.
The Government recently published its Strategic Defence Review (SDR), where it set out a transformation of the country’s defence strategy in response to intensifying global threats and rapid advances in warfare technology. The SDR prioritises readiness, NATO cooperation and innovation, creating new demand for defence infrastructure, industrial capacity, and highly skilled talent.
Key SDR Commitments include the construction of new nuclear-powered submarines and six munitions factories, £15 billion investment in the UK’s nuclear warhead programme, the acquisition of long-range missile systems, major advances in cyber warfare, AI, robotics, energy weapons, and machine learning which will be supported by a £400 million Defence Innovation Fund.
At the end of last year there were a reported three defence industry requirements in the Northwest. But it is not the only region that could see defence related take-up of industrial and logistics space.
Commenting on the SDR, White Commercial managing director Chris White said: “This is not only a turning point in national defence strategy – it’s a catalyst for regional transformation. We anticipate a marked increase in demand for land, industrial and R&D premises, especially in areas where skilled talent and innovation already converge.”
Based in Oxfordshire, White believes regions such as Oxfordshire, Buckinghamshire and Berkshire will be affect significantly due to their already established strategic defence and industry clusters.
And only last month the government has pledged £426 million for Ministry of Defence owned steel producer Sheffield Forgemasters’ new 322,000 ft2 state-of-the-art production facility in the Meadowhall district of Sheffield
Joint agents for the Arc 500 development are Colliers and CPP. Those involved who have responded to Logistics Matters’ request for more information have been unable to confirm the deal.
