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German Industrial : Demand increases - Q2 2013

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A research produced by DTZ

German Industrial : Demand increases - Q2 2013

In the second quarter of 2013, warehouse and logistic space totalling almost 1.26 million sq m was newly let or passed to owner-occupiers through purchases or starts of construction. This exceeded the result for the first quarter by almost 170,000 sq m or 15% and resulted in a half-year figure of almost 2.35 million sq m. Over the past eight years, take-up for the first half year has only ever been higher in 2011.

New investments in industrial real estate totalled € 490 million. The decline from the first quarter can be attributed to the absence of large-volume packages. Over the whole of thefirst half year, around € 1.15 bn was invested in industrial properties.

In the first half of the year, around 930,000 sq m of new warehouse and logistic space spread over 68 properties was added to the market. In the Top 5 regions, stock grew by 96,000 sq m.

Currently, 131 warehouse and logistic spaces with an area of 2.4 million sq m are under construction. Of these, 45 properties with an area of 575,000 sq m were started in the second quarter. Owner-occupier properties and pre-let properties dominate almost all building work. Properties built speculatively are still individual cases.

Prime rents and prime yields for high-grade logistic space have remained stable. The highest rent, at € 6 per sq m per month, is paid in Frankfurt and Munich. The initial yield for prime properties is 7% in both markets.

In the second half of the year, we expect a stable high level of demand for warehouse and industrial space, both in take-up and investment. Prime rents and prime yields will maintain their current level.

Source : DTZ (Groupe UGL)

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Keywords : DTZ