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Property Report - European Logistics Market - H1 2016

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European logistics has been particularly resilient despite some signs of economic slowdown and uncertainties around the Brexit referendum vote. Germany has reached yet another midyear record volume of transactions and the UK maintained a strong level of investment well above its 5-year average. After a strong compression throughout Europe in 2015, prime yields have stabilised at their lowest levels.

The occupier market is slowing down, back to average levels

  • Take-up declined by 22% in Europe (22 cities) compared to the outstanding results recorded in 2015. The activity remained strong in most countries.
  • Germany broke yet again another record level of transaction in H1 2016.
  • Design and build solutions are a strong alternative to the low availability of large units.
  • Few changes in prime rents.

Sustained investor demand and yield stabilisation

  • The investment market for logistics and industrial premises reached €10.8bn in H1 2016.
  • The UK dropped 13% to €3.85bn in industrial and logistics investment in H1 2016. The market represents more than one third of the European volumes.
  • Germany increased by 18% in H1 2016 and prime yields stabilised.
  • Spain and the Netherlands maintained strong activity following an outstanding year 2015.
  • After major compression last year, prime yields have stabilised in most European markets.
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PropReport_Logistics_Sept 2016
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