European Industrial Markets: Have we reached the bottom?
In this report, we look at the drivers and future trends influencing the European distribution warehousing real estate market. In our analysis we include warehouses for storage, distribution centres, cross-docking warehouses, sorting and cleaning centres and cold storage warehouses.
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European Industrial Capital Markets Overview
In the first half of 2009 the European direct real estate investment market showed signs of improvement. Although overall investment volumes remained limited, investor activity has picked up noticeably throughout the year. Whilst this suggests a more positive outlook for the second half of the year, a full recovery will depend on debt markets, which remain constrained, and occupational markets, which look set to remain weak for some time to come. Nevertheless, transaction volumes are expected to pick up further in H2 2009, although some markets will remain out of favour.
European Logistics Occupier Markets Overview
Following the first signs of weakening occupier demand in the second half of 2008 in a majority of the European logistics markets, occupier demand dropped significantly in the first half of 2009. Total take-up in the main European distribution warehousing markets covered in our analysis amounted to 4.7 million m² in H1 2009. Compared to the previous half year (H2 2008) take-up declined by 28% and was 36% lower than in H1 2008. With the balance of power currently geared towards occupiers, many are considering pushing ahead with network restructuring in order to secure favourable lease terms. As a consequence, occupier activity is expected to become more dynamic during 2010.
To speak to us directly about capital markets opportunities in the European Region please contact Chris Staveley.
To speak to us directly about capital markets opportunities in the UK please contact Michael Kershaw.
To speak to us directly about our European industrial markets research capability please contact Alexandra Tornow.