HU management is only permitted if partner storage location is specified

What causes this issue?

If you want to specify a storage location as being HU-managed, you must
assign a non-HU partner storage-location to it. Unpacked stock will be
transferred to the partner storage-location if no other storage
location is specified. Similarly, packed stock will be transferred from
the partner storage-location if no other storage location is specified.

System Response

Since no unpacked inventory can exist at HU-managed storage locations,
the HU-storage location indicator cannot be set.

How to fix this error?

Specify a non-HU-managed partner storage-location.

Procedure for System Administrators

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

Error message extract from SAP system. Copyright SAP SE.