June 29, 2015

Q1 European logistics and industrial take up 6 percent higher than 2014

Q1 European logistics and industrial take up 6 percent higher than 2014

European logistics and industrial take-up reached 3.8 million sqm in the first quarter of 2015, a 6 percent increase on a year ago, according to a DTZ report. The increase was driven by demand for logistics and industrial space, as a result of the more positive economic outlook across Europe, with retailers and industrial companies most active in the three core markets of UK, Germany and France.

Commenting on the increase, Robert Hall, Head of EMEA Logistics at DTZ, said: “Location-wise, Germany remained the most active market in Europe in Q1 2015, with 35 percent of total occupier activity recorded in the region. The CEE region also had a strong start to the year with more than 800,000 sqm of logistics space leased, up by 32 percent in comparison with the same period a year ago.”

Marc Le Bozec, Head of Industrial & Logistics Agency at DTZ Poland, added: “In the CEE, the Polish market was the most dynamic in terms of tenant activity, with 700,000 sqm leased. New space was in highest demand in Poznań, Wrocław, and the Silesia region. We expect the volume of the lease agreements concluded in 2015 to exceed 2.5 million gross sqm.”

After several years of downward pressure, industrial rental values remained stable in the majority of European markets, showing increases in some of the CEE markets, such as Bucharest and Budapest. In the long-term, prime industrial rental values are expected to enter an upward cycle, with average increases of 1.6 percent per annum forecast over the next five years.

Industrial investment volumes in Europe reached €4.2 billion for Q1 – comparable to Q1 2014 figures, a record year for the decade. In terms of locations, the UK was the main European investment hotspot with €1.3 billion of inflows, and the largest transaction of the quarter, the acquisition of a €323 million portfolio by Cerberus Capital Management, was signed in Italy.

Magali Marton, Head of EMEA Research at DTZ, added: “Continuing the 2014 trend, international and US-based investors showed a strong interest in European industrial markets, completing almost €1 billion of the logistics assets acquisitions in the region in Q1 2015. We expect to see investor activity continuing on the buy-side as a couple of pan-European portfolios are currently on the market.”

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