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Logistics market

Demand for logistics and warehouse space is at a persistently high level

3.6 Mio. qm NF

Flächenbestand 2020 (moderne Logistikimmobilien Baujahr < 10 Jahre)

329.400 qm NF

Fertigstellungen 2020

5,20 €/qm NF

Spitzenmiete 2020

Source Bulwiengesa AG

Note: The calculation of the prime rent is based on the definition of the Gesellschaft für Immobilienwirtschaftliche Forschung e.V. (Society for Real Estate Research). In the markets, deals are also concluded above the median prime rent.

Volume of new construction

In 2020, a total of approx. 330,000 m² of new construction space was added to the logistics property market in the Metropole Ruhr, which is significantly below the 5-year average of approx. 450,000 m². The shortage of land, the reluctance to designate potential sites (e.g. as commercial areas) and competition from other types of use are putting pressure on completion figures in the Metropole Ruhr.

The highest volume of new construction last year was in the district of Unna with 118,000 m², followed by the district of Recklinghausen with approx. 60,000 m² and Duisburg with approx. 50,000 m².

The large-volume finalised projects in 2020 include the construction of a new distribution property with around 63,000 m² of logistics space for the Woolworth retail chain in Kamen, the construction of a new distribution property with around 35,000 m² for the food retailer REWE in the Alpha Industrial logistics park in Duisburg and the completion of the Nordfrost deep-freeze warehouse with 34,000 m² in the Unser Fritz logistics park in Herne.

According to the pipeline, around 440,000 m² of logistics space is currently under construction with a planned completion date in 2021. In addition, there are around 260,000 m² with concrete planning status and possible completion this year, so that a significantly higher volume of new construction above the 600,000 m² mark is possible.

"The amount of space in modern logistics properties that are no more than 10 years old increased by 7.9% in 2020 to around 3.6 million sqm"

 

bulwiengesa AG

 

Take-up in modern logistics properties

The effects of the corona pandemic on the real estate market in the Metropole Ruhr have shown that, among the commercial property types, it is predominantly logistics properties that are meeting with sustained high demand. In contrast to retail or hotel properties, logistics properties are among the crisis winners in the Corona pandemic. The systemic relevance of logistics became apparent during the crisis and demand for logistics and warehouse space is at a persistently high level.

In 2020, the take-up of space in modern logistics properties was around 480,000 m², which marks the third highest value in the period under review. The regional focus is on the Unna district with around 136,000 m², followed by Duisburg with 110,000 m² and the Recklinghausen district with around 53,000 m².

The share of owner-occupiers was approx. 26.1 % or approx. 126,000 m². Rentals under construction contributed 26.3 % or approx. 128,000 m² to the turnover result, which is due to the increase in (partly) speculative construction activity. It is evident that project developers and investors are acting optimistically and are assuming that demand for logistics space will continue to rise. They are also meeting this demand with speculative construction activity, as they expect a relatively short marketing period for space in attractive locations.

The pre-letting volume totalled around 52,000 m², which corresponds to a turnover share of approx. 10.9 %. The highest share of 36.6 % or approx. 177,000 m² is accounted for by lettings in existing buildings.

The sector-specific demand was dominated by retail companies with approx. 35.8 % or approx. 173,000 m², followed by the logistics and transport sector with approx. 26.6 % or 128,000 m². The user sector eCommerce accounted for approx. 17.3 % or approx. 84,000 m². The manufacturing sector contributed 11.2% or 54,000 m² to turnover, scientific and technical service providers 6.8% or approx. 33,000 m² and other users (e.g. public sector) 2.2% or 11,000 m².

For 2021, the demand for logistics space in the Metropole Ruhr is expected to remain high, which could only be slowed down by the limited supply of modern logistics space in prime locations and the availability of land.

Prime and average rents for warehouse and logistics space

The top rent for logistics properties in the Metropole Ruhr has stabilised at the high level of 5.20 euros/m² and is primarily achieved in Dortmund and, with marginal reductions, also in Duisburg and Essen. In individual cases, rents above the current level are also achievable with clearly above-average property and location qualities.

The average median rent for the submarkets of the Metropole Ruhr has shown a consistently positive trend since 2013 and stood at 3.50 euros/m² at the end of 2020, which represents a slight increase of 1.9 % compared with the previous year. In the short to medium term, there is potential for rising logistics rents in the Metropole Ruhr, based on sustained high demand and a shortage of supply.