The occupier market proved resilient in H1 2022 even though the first signs of slowdown were recorded in Q2.
Market fundamentals are healthy. There is steady demand, fuelled by e-commerce, and no risk of oversupply with vacancy rates at their lowest ever levels. This continues to put further pressure on rents.
The average vacancy rate is below 4% in Europe with few speculative developments.
Demand is structurally robust despite some uncertainties for the next two quarters.
Prime rents increased by 12.2% over the last 12 months in Europe, notably supported by strong growth in the UK.
H1 set another half-year historical record level of investment, even with a slower Q2. The dynamics of the market is evolving with massive amounts of capital still to be deployed yet strong movements in interest rates pushing prime yields up across Europe.
Industrial and logistics reached a peak with €30 bn invested in H1 2022, +6% compared to last year.
The development pipeline still cannot supply enough product to meet demand.
Prime yields started to decompress in France, Germany, The Netherlands and Spain.
Further decompression is expected in Q3, including in the UK.