2021 is expected to be a record year for investment into European logistics, according to a new report published by Knight Frank.
Investment during the first three quarters of 2021 totalled €38.3 bn, the strongest Q1 - Q3 period on record. European logistics investment is therefore well on track to surpass 2017’s record year for investment.
On average, over the past five years, €16 bn worth of investment was finalised in European logistics real estate in the final quarter, which is double the amount needed for 2021 to outstrip 2017’s €46 bn record, a year that was significantly bolstered by CIC’s €12 bn acquisition of Logicor.
The UK is proving particularly attractive for investors, proving the largest recipient of investment, with €5.1 bn (£4.4 bn) transacted during the quarter. Investment into UK Industrial real estate is already experiencing a record year, with volumes in the first three quarters exceeding the previous 2017 full-year record.
In terms of sources of capital, the U.S remains the largest investor into European industrials, accounting for 43% of total cross border investment. Foreign investment into the sector continues to be robust, with cross-border investment amounting to 70% of Q3 figures.
Richard Laird, co-head European Capital Markets at Knight Frank, said: ‘2021 is expected to mark a record year for investment into European logistics, with investor demand continuing to intensify, having been accelerated by many of the structural shifts brought about by the pandemic.’
He added: ‘As we look to the economic recovery post-pandemic and a very strong occupational demand to supply equation, it’s clear to see that logistics continue to be an attractive asset class for investors.’
