Europe | Logistics

Property Report - Q4 2015

The logistics occupier market is picking up - February 2016

European logistics gained momentum in 2015 and a number of markets are close to their record levels for transaction volumes.

Low interest rates and favourable financing conditions have also stimulated investment. Prime yields contracted significantly reflecting stronger demand in letting & sales and limited prime availability.

The logistics occupier market is picking-up

- Take-up increased by 28% in Europe (22 cities) but the lack of prime supply is still affecting the market.

- Germany reached its highest volume of transactions in 2015 at 5.2 million sqm followed by France (3.1m sqm) and the UK (3m sqm).

- E-commerce remains a significant market driver.

- Design and build prevails as a strong alternative to limited speculative developments.

- Prime rents evolved only marginally despite market growth.


Strong investors’ demand and yield contraction

- The investment market for logistics and industrial premises reached €26.7bn in 2015

- The UK dropped 33% to €9.7bn in industrial and logistics investment in 2015. The market represents more than one third of the European volumes.

- Germany broke yet again another record and prime yields dropped by 100bp in the 6 major regional markets.

- Spain and the Netherlands have been catching-up thanks to strong economic improvement, thus stimulating investors’ interest.

- Prime yields contracted between 50 and 100 bp in most European markets.


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Richard Malle
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